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CEOMorningBrief HOME: Existence of vernacular schools is constitutional, apex court rules p2

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SHAHRILL BASRI/ THEEDGE

Bank Negara: Ringgit’s

fall does not reflect
Malaysian economy’s
positive outlook
Report on Page 3.
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
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Existence of vernacular schools is
constitutional, apex court rules
PUTRAJAYA (Feb 20): The existence of
vernacular Chinese and Tamil schools is
constitutional, the Federal Court on Tues-
day ruled in a majority two-one decision
that refused leave to two non-governmental
organisations (NGOs), namely the Islamic
Education Development Council (Map-
pim) and the Coalition of National Writers’
Association (Gapena), to hear the merits
of their appeal.
Federal Court judges Datuk Mary Lim
Thiam Suan and Datuk Rhodzhariah Bu-
jang ruled against granting leave, while Da-
tuk Abdul Karim Abdul Jalil was in the
minority. As such, the Court of Appeal’s
decision in November last year — ruling
that vernacular schools in the country are
within the Federal Constitution — stands.
“The apex court is not satisfied that the
sole question posed has passed the thresh-
old under both limbs of Section 96 (a) and
(b) of the Courts of Judicature Act (CJA)
1964. Hence, the motion for leave to ap-
peal is dismissed without costs,” Lim, who
chaired the bench, said.
In civil cases, leave (permission) has to
be obtained before the full merits of an
appeal is heard based on the questions of
law posed.
The apex court’s refusal to grant leave
means that the Court of Appeal decision
on Nov 23 last year stands — that the use
of Chinese and Tamil as the medium of
instruction in Sekolah Jenis Kebangsaan
(Cina) and Sekolah Jenis Kebangsaan (Ta-
mil) is not against the Constitution.
Gapena and Mappim, represented by
lawyer Mohd Haniff Khatri Abdullah, ini-
tially posed eight questions, namely six con-
stitutional and two of law, for consideration.
However, this was reduced to one ques-
tion — whether the medium of instruction
in the process of teaching and learning in
Chinese and Tamil national type schools,
2 TheEdge CEO morning brief
published by
(266980-X)
. 603-77218000
tel
Level 3, Menara KLK, 1 Jalan PJU 7/6,
Mutiara Damansara, 47810, Petaling Jaya,
Selangor, Malaysia
h o m e
by Hafiz Yatim
theedgemalaysia.com
established under Sections 2, 7, and 28 of
the Education Act 1996, is for an official
purpose and therefore subjected to the ob-
ligation under Article 152(1) of the Feder-
al Constitution, which requires the use of
the national language (Bahasa Malaysia or
Malay) for all official purposes?
Haniff told the bench that this sole ques-
tion covers or encompasses the other seven
questions that were initially filed.
“The question has covered the constitu-
tional aspect of the matter from the High
Court and hence, leave should be granted
for the matter to be heard on its merits.
“Furthermore, this issue is of public im-
portance, as such a challenge had not been
made before since independence, and the
apex court should hear the matter to bring
a finality of the matter,” he added.
Four respondents — the United Welfare
of Retired Tamil Teachers Malaysia (Persat-
uan Gabungan Kebajikan Guru-guru Ber-
sara Sekolah Tamil Malaysia), along with
the Malaysian Chinese Language Council
(Majlis Bahasa Cina Malaysia), Malaysian
Tamil Neri Association (Persatuan Tamil
Neri Malaysia) and United Association of
Malaysian Tamil Students — did not op-
pose the question by Gapena and Mappim.
However, 10 other respondents, includ-
ing the government and education minister,
opposed the sole leave question.
Senior federal counsel Liew Horng Bin,
who appeared for the government and the
minister, said that although the question
appeared to be a constitutional question,
the court should be satisfied that it had
passed the threshold under Section 96 of
the CJA.
Liew also cited Education Minister
Fadhlina Sidek’s statement last month sup-
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porting the existence of vernacular schools.
“The federal government is desirous of
maintaining vernacular schools, that is to say
preserving and sustaining vernacular schools,
a right which is provided to the federal and
state governments under Article 152(1)(b)
of the Constitution,” Liew quoted Fadhli-
na as saying, adding that this is a clear and
unequivocal statement from the minister.
Counsel Datuk Malik Imtiaz Sarwar for
Chong Hwa Independent High School of
Kuala Lumpur told the bench that he had
received instructions to oppose the ques-
tion, as there is a distinction between a
political issue and a legal one.
“Furthermore, like Liew had said, it is
not necessary for the apex court to grant
permission to hear constitutional issues,”
he said.
Dong Zong and Jiao Zong counsel Lim
Hoon Shi informed the court that the two
appealing NGOs are not likely to succeed,
as the High Court and Court of Appeal
had affirmed the existence of vernacular
schools.
“There was no dissenting judgement
even in the Court of Appeal, where the
written judgement by Datuk Azizul Azmi
Adnan was unanimous,” he said.
Other organisations that opposed the
question posed by Mappim and Gapena
were Gerakan, MCA, MIC, along with Per-
satuan Thamizhar Malaysia and Persatuan
Tamilar Thirunal Perak, which adopted the
submissions of the other opposing parties.
Initially, four Malay NGOs had chal-
lenged the validity of vernacular schools,
where they filed the challenge in the Kua-
la Lumpur and Kota Bharu High Courts.
However, two NGOs did not join Mappim
and Gapena in the final appeal.
Read the full story
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4 3 TheEdge CEO morning brief

h o m e

Bank Negara: Ringgit’s fall does not reflect

Malaysian economy’s positive outlook
by Emir Zainul
theedgemalaysia.com Malaysian ringgit appreciation/depreciation against other currencies
1-year % change
KUALA LUMPUR (Feb 20):The ringgit’s Japanese yen 3.34
current level does not reflect the positive
outlook of the Malaysian economy, the cen- -2.57 Australian dollar
tral bank said on Tuesday, as the currency -3.07 Chinese renminbi
dropped to its lowest against the US dollar -3.07 Thai baht
since 1998 and hit a fresh record low against
-4.64 Indonesian rupiah
the Singapore dollar.
Bank Negara Malaysia (BNM) governor -7.01 Singapore dollar
Datuk Abdul Rasheed Ghaffour said the re- -7.69 US dollar
cent performance of the ringgit is similar to -8.48 Euro
other regional currencies, in that they have
been influenced by external factors. -11.73 British pound
“Some of these factors include market ad- -12 -10 -8 -6 -4 -2 0 2 4
justment to changing US interest rate expec- *As at 5.10pm on Feb 20, 2024 Source: Bloomberg
tations, geopolitical concerns and uncertain-
ty surrounding China’s economic prospects,”
he said in a statement addressing the issue. Ringgit vsringgit
US$ appreciation/depreciation
Ringgit vs Singapore dollar
The ringgit reached its 26-year low of Malaysian
4.800 against the US dollar on Tuesday, a against
4.3 other currencies 3.2
range last seen in 1998 at the peak of the 4.4303 1-year % change
Asian financial crisis, when it touched a re- 3.3153
cord low of 4.885 against the greenback on 3.3
4.5 Japanese yen 3.34
Jan 7 that year.
At the time of writing, the ringgit has pared -2.57 Australian
3.4 dollar
some of its losses to trade at 4.799 per US dol-
lar, tracking other emerging Asian currencies 4.7 -3.07 Chinese renminbi
which also weakened against the US dollar. -3.07
3.5
Thai baht
Year to date, the ringgit has fallen close
to 4% against the US dollar so far. Over the 4.8003 3.5665
-4.64 Indonesian rupiah
4.9 3.6
past one year, the ringgit has fallen against
Feb 20, 2023
-7.01 Feb 20, 2024 Feb 20,
Singapore 2023
dollar Feb 20, 2024
most major regional currencies, save for the
Japanese yen. Against the Singapore dollar, *As at 5.15pm on Feb 20, 2024 *As at 5.15pm on Feb 20, 2024
-7.69
Source: Bloomberg US dollar
Source: Bloomberg
the ringgit skidded to its new record low of
3.5683, where it was hovering at press time. -8.48 Euro
Abdul Rasheed went on to assure that Shahrill Basri/The Edge

Malaysia’s economic growth in 2024 will -11.73 End-2024

British poundforecast for
be driven by improvements in external de- Malaysian ringgit vs US dollar
mand and strong domestic spending. He -12 -10 -8 -6 -4 -2 0 2 4 End-2024
also pointed to the latest global trade growth *As at 5.10pm on Feb 20, 2024 Source: Bloomberg Bank/research house target
forecast from the International Monetary Citigroup 4.75
Fund (IMF) of 3.3% in 2024 as opposed RBC Capital Market 4.65
For Instagram
to 0.4% in 2023. MUFG 4.60
“For Malaysia, exports have shown OCBC 4.60
steady improvements since the fourth quar- The ringgit reached 4.800 against the US dollar on CIMB 4.60
ter of 2023. In fact, the recently-released Tuesday, its lowest in 26 years, as emerging Asian
currencies weakened against the US dollar. UOB 4.50
January 2024 exports have turned positive Bank of America 4.50
(up 8.7%). The tourism sector has recov-
AmBank 4.50
ered strongly with tourist arrivals in 2024 lowering of interest rates in advanced econ-
Nomura Bank International 4.45
expected to exceed the pre-pandemic lev- omies, most analysts are forecasting for the
els of 26 million. Investment momentum ringgit to appreciate this year,” he added. Kenanga 4.42
has picked up with the implementation of When asked by Bernama if there is a need Maybank 4.40
approved projects both in the private and to peg the ringgit against the US dollar, Fi- PublicInvest 4.35-4.40
public sectors,” he noted. nance Minister II Datuk Seri Amir Hamzah MIDF 4.20
“Reflecting these positive developments Azizan on Monday said the current situa- Sources: Bloomberg, research reports
and the government’s commitment to im- tion is very different compared to the Asian
plement structural reforms and the expected financial crisis of 1998. co n ti n ues o n Page 4
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
KUALA LUMPUR (Feb 20): Malay-
sia’s exports grew 8.7% to RM122.43
billion in January — the first year-on-year
growth after contracting for 10 straight
months.
The growth pace exceeded Bloomberg’s
consensus estimate of 3%. This helps re-
inforce the positive export outlook held
by some economists who expect that im-
proved regional economic growth, par-
ticularly in China, will drive Malaysia’s
exports.
However, one swallow does not make
a summer, and other economists are con-
cerned about uncertainties due to geo-
political tensions.
It is worth noting that exports for elec-
trical and electronics (E&E) products
contracted 6.5% year-on-year in Janu-
ary. Still, some economists remain opti-
mistic that the sector is due for recovery
because of the expected turnaround of
the global technology downcycle, which
in turn will fuel export growth.
In a research note on Tuesday, RHB
Investment Bank said it maintains its san-
guine view of the trade outlook for Ma-
Exports rebound to y-o-y increase in January
y-o-y change (%)
15 10.3
10
5 1.4
-0.9
0 the Red Sea Crisis will further disrupt the
-5 -1.4
-10
-15
-20 -14.1
-17.5
Jan Feb Mar Apr May June July Aug Sept Oct
2023
Source: Department of Statistics Malaysia
from Page 3
“When Malaysia pegged the ringgit
against the US dollar in 1998, it was re-
acting to a very different scenario out there
and [within] a very different financial ca-
pacity of the country at the time. Today,
when we look at the national reserves,
debt exposure and financial liquidity in
the market, Malaysia does not need to
peg its currency,” he maintained.
At the height of the Asian Financial
Crisis in 1998, BNM pegged the value
of the ringgit at 3.80 to the US dollar in
an effort to isolate the Malaysian econo-
my from the financial instability sweeping
over the region at the time.
Slower-than-expected US rate cuts,
weakening renminbi to watch
Forecasts for the ringgit versus the US dol-
4 TheEdge CEO morning brief
h o m e
January trade
figures raise
hope of export
recovery
by Hee En Qi
theedgemalaysia.com
laysia on the back of a rosier global and
regional economic outlook.
“Higher import demand from China is
anticipated as the economic momentum
in China has begun to gather steam. Ma-
laysia would be at the forefront to benefit
from the recovery in China’s economy as
key export products, such as E&E, ma-
chinery and transport equipment, and
other manufactured goods, command the
lion’s share of trade in China’s import
demand,” it said.
As such, it expects the E&E exports
to grow further, particularly due to a
-13.0 -13.8 -4.5
-6.1
-18.7 -10.0
Nov Dec
2024
lar range from 4.20 to as weak as 4.75 by
the end 2024, according to economists
estimates compiled by The Edge. Median
forecasts for the currency for 2024 stood
at 4.50, before strengthening to 4.35 by
end-2025, according to forecasts compiled
by Bloomberg.
MIDF Research, which is expecting
the ringgit to recover to 4.20 against the
US dollar by year end, sees a narrow-
ing rate differentials — the US Federal
Reserve are expected to cut rates this
year — to contribute to the reversal of
funds back into emerging markets and
Malaysia.
“On the other hand, several factors
could weigh down on ringgit performance
such as possible recession risk in the US,
and continued weakness in global trade
and manufacturing activities,” the research
positive spillover effect from China’s
improved trade performance and man-
ufacturing activities.
Meanwhile, MIDF Research echoed
the positive outlook and projected that
Malaysia’s exports would rebound by
5.2% in 2024, driven by increased de-
mand for petroleum products and palm
oil, alongside the anticipated turnaround
in the E&E trade.
The research house commented that
the 7.4% contraction in exports to China
and 7.9% to Hong Kong could be caused
by slower business activities ahead of the
Lunar New Year holiday.
Nevertheless, MIDF anticipates that
shipments to major markets such as Chi-
na, the US and regional countries will
improve, thereby supporting trade recov-
ery this year.
However, it also cautioned against sev-
eral downside risks such as the worsening
of geopolitical and trade tensions, lower
demand from major trading partners and
prolonged weakness in global production
activities.
On the other hand, UOB Global Eco-
nomics and Markets Research holds a
more prudent outlook for Malaysia’s ex-
ports with an estimated growth of just
3.5% in 2024 due to the lingering macro
headwinds.
8.7
“An escalation and extension of geo-
political tensions in the Middle East and
global supply chain and lift costs, while
an ongoing rout in China’s real estate
sector and a restrictive global monetary
policy stance for a prolonged period will
Jan
likely keep external demand subdued and
temper an expected upturn in the glob-
al tech cycle this year,” it said in a note
on Tuesday.
house said in a January report.
The longer it takes for the spread be-
tween US and Malaysia’s benchmark
interest rates to narrow, “the worse it is
for the ringgit,” a banker told The Edge.
Malaysia’s overnight policy rate current-
ly stands at 3%, while the US Fed funds
rate is at 5.5%.
Aside from persistent inflation in the
US that could slow rate cuts there, mar-
ket watchers are also keeping an eye on
the weakening Chinese renminbi, which
affects the competitiveness of exports of
Southeast Asian countries like Malaysia
— making the weak ringgit less beneficial,
the banker said.
“It is important that the tens of billions
of FDIs under recent MOUs to materi-
alise” to support the local currency, he
added.
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
Yinson mulls
US$1 bil funding
round for unit
before IPO,
Bloomberg
reports
by Elffie Chew
Bloomberg
(Feb 20):Yinson Holdings Bhd, an energy
infrastructure firm, is considering raising
about US$1 billion (RM4.79 billion) in
a funding round for its floating produc-
tion, storage and offloading (FPSO) unit
before an initial public offering (IPO) of
the business, people with knowledge of the
matter said.
The company is working with a finan-
cial adviser on the fundraising for Yinson
Production Offshore Pte Ltd, the people
said.Yinson and its adviser plan to officially
kick off the pre-IPO funding round as early
as next month, while the asset may attract
global funds and private equity funds, the
people said.
RRJ Capital, which invested US$300 mil-
lion inYinson Production’s Angola project,
KUALA LUMPUR (Feb 20): KPJ Health-
care Bhd aims to exit the Australian health-
care market within two years, according to
its president and managing director Chin
Keat Chyuan.
Currently, he said that the company op-
erates the retirement village business in that
market after selling its aged-care operations
in December 2023.
“We have not found a buyer yet. Hope-
fully, within the next 12 to 24 months, once
we find a buyer, we will conclude the busi-
ness and exit Australia,” he told reporters
after the fourth quarter 2023 financial re-
sult announcement at KPJ Ampang Puteri
Specialist Hospital on Tuesday.
Chin said the company will continue to
evaluate all its international operations while
shifting its focus solely on Malaysia.
He said that when considering whether
or not to continue a business in one par-
ticular location or country, the company al-
ways evaluates its feasibility, viability, and
scalability.
In addition to Australia, KPJ Healthcare
also has overseas businesses in Bangladesh
and Thailand, and just last year, it exited
the Indonesian market.
5 TheEdge CEO morning brief
h o m e
plans to commit another US$320 million
in the funding round, according to Richard
Ong, the private equity fund’s chief execu-
tive officer.Terms of the investment haven’t
been finalised, according to him.
The Singapore-based FPSO unit is es-
timated to report about US$680 million in
earnings before interest, taxes, depreciation
and amortisation for the year ended 2023,
said the people.Yinson is weighing a US IPO
for the FPSO business as soon as 2026, the
people said, asking not to be identified as
the information is private.
Deliberations are ongoing, and details of
the funding round and the listing plans may
still change, the people said. A representative
of Yinson Holdings declined to comment.
Yinson Production has contracts with
firms including Brazil’s state oil company
KPJ Healthcare
aims to exit
Australian
market within
two years
Bernama
KPJ Healthcare Bhd president and managing
director Chin Keat Chyuan said they will exit
Australia once they have found buyer for their
retirement village business in the next two years.
yinson.com
Petrobras and the Angolan joint venture of
energy majors BP plc and Eni SpA. Besides
RRJ, Global Infrastructure Partners and Su-
mitomo Corp have also provided financing
to Yinson Production’s projects.
The company has an order book of about
RM100 billion, which includes both firm
contracts and options and will last for 20
years, Yinson Holdings CEO Lim Chern
Yuan said in an interview in September last
year.The group wouldn’t rule out spinning
off some of its businesses or selling a stake
to bring in strategic investors to help grow
the business, he said.
Apart from FPSO, Yinson Holdings is
also involved in renewable energy, green
technology as well as advisory, investment
and asset management via its Farosson unit,
according to its website.
Chin said that the business in Bangladesh
has been performing well with no losses.
“So it is business as usual for now. But in
the long run, we are considering whether to
continue business there.We are conducting
an assessment on the feasibility, viability, and
scalability over there,” he said.
As for Thailand, Chin said that the busi-
ness is currently profitable.
“We only invest there and we do not op-
erate anything.We have no other investments
besides injecting capital. So, currently, we are
going to keep the business there,” he said.
In 2023, KPJ Healthcare successfully
finalised the sale of its hospital operations
in Indonesia, Rumah Sakit Medika Bumi
Serpong Damai, to PT Nusautama Medi-
calindo, resulting in total cash proceeds of
RM156.7 million.
“That is the extent of our international
business. So, 95-98% of our business mov-
ing forward will be in Malaysia.
“We have a total of 29 hospitals here in
Malaysia, and one is currently under con-
struction. Why build more hospitals over-
seas when we can bring patients to Malay-
sia and utilise our facilities and manpower
here,” he added.
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
Maybank
announces top
management
changes
by Syafiqah Salim
theedgemalaysia.com
KUALA LUMPUR (Feb 20): Malayan
Banking Bhd (Maybank) on Tuesday an-
nounced changes to its top leadership to
drive the bank’s business growth and re-
alise its full potential to ensure long-term
sustainability and excellence in line with
its M25+ aspirations.
The bank has appointed Datuk Mu-
zaffar Hisham, currently its group CEO
of global banking, to succeed Datuk Mo-
hamed Rafique as the group CEO of Is-
lamic Banking and CEO of Maybank Is-
lamic Bhd.
Rafique, meanwhile, will assume the
role of advisor from March 1 and will re-
tire from the Maybank Group on June 20,
Malaysia’s largest bank said in a statement.
Datuk John Chong will take over the
role of group CEO of global banking from
Muzaffa. Chong is currently serving as the
group CEO of community financial ser-
vices (CFS), according to the bank.
Syed Ahmad Taufik Albar, on the other
hand, will be the new group CEO of CFS.
KUALA LUMPUR (Feb 20): Malaysian
banks’ earnings will likely be subdued
quarter-on-quarter (q-o-q) in the final
three months of 2023, hurt by net interest
margin pressure, higher expenses and ele-
vated credit costs, RHB Investment Bank
(RHB IB) flagged on Tuesday.
Net interest income could be “flattish”
with the expansion in the loan base off-
set by competition for deposits and im-
pact of May’s policy rate increase, RHB
IB said ahead of upcoming results. Inves-
tors should also expect higher operating
expenses and loan provisions, the research
house cautioned.
“Generally, we do not expect adverse
developments on asset quality,” RHB IB
said. Sector profit-before-tax, however,
could be muted q-o-q though net prof-
it could be boosted by AMMB Holdings
Bhd, which will book RM538 million in
tax credit, it noted.
Shares of Malaysian banks have mostly
risen as investors bet on expanding loans
and rising fees amid heightened competi-
tion for deposits and volatile markets. Affin
6 TheEdge CEO morning brief
h o m e
Dato’ Muzaffar Hisham
Syed Ahmad Taufik Albar
He was previously managing director of
group wholesale banking and group chief
financial officer at RHB Bank Bhd.
On top of that, CFS director of PT
Bank Maybank Indonesia Tbk (MBI)
Steffano Ridwan has been nominated to
take over the role of MBI president di-
rector from Taswin Zakaria, who will be
concluding his term on March 31.
Steffano’s appointment, Maybank said, is
subject to approvals from the Otoritas Jasa
Keuangan and shareholders of the company.
“These appointments will enable us
RHB IB says
banks’ Oct-Dec
earnings likely to
be subdued, stays
‘neutral’ on sector
by Luqman Amin
theedgemalaysia.com
Bank Bhd was the best performer with a
25% surge year-to-date though Hong Le-
ong Financial Group Bhd underperformed
with 0.4% decline.
Overall, RHB IB maintained its “neutral”
stance on the banking sector with CIMB
Group Holdings Bhd (“buy”; target price
or TP: RM6.88), AMMB (“buy”; TP:
RM4.70), Hong Leong Bank Bhd (“buy”;
TP: RM23.20), and Alliance Bank Malaysia
Bhd (“buy”; TP: RM4.00) as its top picks.
Dato’ John Chong
Steffano Ridwan
to strengthen the capabilities of our top
leadership team, building on each oth-
er’s diverse experience and background.
This will be vital in ensuring that we are
well-positioned to steer Maybank forward,
as we pursue our M25+ strategic objectives
and beyond as well as continue delivering
exceptional value to our customers and
stakeholders,” said Maybank president and
group CEO Datuk Khairussaleh Ramli.
Shares of Maybank closed up five sen or
0.53% at RM9.51 on Tuesday, giving it a
market capitalisation of RM114.69 billion.
Earnings of CIMB, which will come
in next Thursday (Feb 29), could “slight-
ly outperform” the research house’s esti-
mates, driven by higher non-interest in-
come and lower-than-expected credit costs,
RHB IB noted. Further, dividend per share
may also exceed forecasts, it said.
For AMMB, the research house said its
earnings could be bolstered by the utilisa-
tion of the tax credits, which could lower
its effective tax rate and lift its net profit.
AMMB is expected to release its results
next Monday (Feb 26).
Alliance Bank, scheduled to release its
third-quarter results next Tuesday (Feb
27), could report “slightly softer” net prof-
it q-o-q and year-on-year, RHB IB said. Al-
liance Bank’s renewal of its bancassurance
contract could drag non-interest income to
about 15% of total income in the third quar-
ter from 17% in the second quarter, it noted.
Hong Leong Bank’s earnings growth,
meanwhile, could be “steady” underpinned
by its resilient net interest margins, and robust
fee income. Hong Leong Bank is expected to
announce its result next Wednesday (Feb 28).
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
KUALA LUMPUR (Feb 20): Southeast
Asian (SEA) stocks are likely to underper-
form this year compared to those in the
rest of Asia and the Western markets given
the absence of positive catalysts to attract
more capital, according to Nomura Asset
Management Malaysia.
“I can say that SEA stocks are still chal-
lenging and there are no catalysts yet.
“Indonesia is good in the short term, [but]
after the general election we will have to see
how stocks perform. Malaysia is still stuck
in the middle income trap coupled with (the
issue of) government stability;Thailand has
zoning issues, while Singapore is seen as quite
defensive,” said its managing director and
country head Leslie Yap.
“Also, investment opportunities in
Southeast Asia are always about the po-
tential for consumer growth to drive con-
sumption. Consumption is not something
that global investors see as important at
this stage, so their allocation will tend to be
slightly away from SEA,” he told The Edge
after a lunchtime conference on Tuesday.
In 2023, the Vietnam Ho Chi Minh 30
Index (VN Index) was the biggest gainer in
SEA with an impressive 12.56% climb, fol-
lowed by the Jakarta Stock Exchange Com-
posite Index (Jakarta SECI) with a 6.16%
gain, while the benchmark indices in Ma-
laysia, Singapore and Thailand dropped.
KUALA LUMPUR (Feb 20): The Bur-
sa Malaysia Energy Index rose 5.68% on
Tuesday to reach its highest level since
March 2021 at 946.95 points, led by gains
in Dialog Group Bhd, Bumi Armada Bhd
and Dayang Enterprise Holdings Bhd.
Oil and gas stocks were among top ac-
tives on improved sentiment after a strong
showing in Dialog’s earnings on Monday.
Dialog, which has the highest weightage
of 31.87% in the index, rose 34 sen, or
18.28%, to close at RM2.20 on Tuesday,
valuing the group at RM12.42 billion. It
was the third most gainer on Bursa Malay-
sia for the day and the third top active with
92.08 million shares transacted. Year to
date, the counter has risen 6.8% or 14 sen.
On Monday, Dialog reported that its
net profit rose 16.62% to RM148.29 mil-
lion for the second quarter ended Dec
31, 2023 (2QFY2024) on higher revenue
driven by better performances of both its
Malaysian and international operations.
Quarterly revenue rose 7.8% to
RM859.21 million from RM797 million
in 2QFY2023. The results largely met an-
alyst expectations.
Following the financial results an-
nouncement, 11 out 15 analysts cover-
ing the stock maintained their ‘buy’ calls,
while three had ‘hold’, and one analyst a
7 TheEdge CEO morning brief
h o m e
Nomura: SEA
followed by the FBM KLCI at 6.94% and
the Jakarta SECI with 1.1%; Singapore
stocks likely to
STI saw a marginal 0.12% increase while
the Thai SET declined 2.08%.
underperform
On the asset class that is expected to per-
form well this year, Nomura Asset Manage-
without catalysts
ment Co Ltd’s (NAM’s) chief investment
officer of active global investments Takahiro
Nakayama pointed to global equities such
as Nvidia,Tesla and Apple in the US, saying
by Syafiqah Salim the potential for a productivity revolution
theedgemalaysia.com driven by artificial intelligence (AI) presents
appealing investment opportunities.
KLCI performance versus “But despite the anticipated long-term
regional indices benefits from AI-driven productivity and lower
interest rates in the US, the focus should be on
Index One-year YTD
change (%) change (%) structural growth factors, involving a key fo-
KLCI -2.73 6.94
cus on elements such as profitability strength,
financial health and other qualitative aspects
Singapore -0.34 0.12
of corporate earnings,” Nakayama said.
Jakarta 6.16 1.10
On global fixed income, bond yields
Thailand -15.15 -2.46 have started to decline in anticipation of
Data compiled on Feb 20, 2024 major central banks cutting their policy
Source: Bloomberg
rates this year, said NAM’s head of invest-
ment of global fixed income Yuji Maeda.
The FBM KLCI registered a 2.7% decline, “The influence of inflation on monetary
while the Singapore Straits Times Index policy has been significant and continues
(Singapore STI) slipped 0.34%; the Stock to be so. The expected decline in inflation
Exchange of Thailand’s Index (Thai SET) could prompt the US Fed and other ma-
declined the most, dropping 15.15%. jor central banks to implement policy rate
So far for 2024, the VN Index contin- cuts, contributing to the overall decline in
ued to lead the pack with a 9.74% gain, bond yields,” said Maeda.
Bursa Malaysia
‘sell’ rating. The median target price is
RM2.74, according to Bloomberg, implying
Energy Index hits
a potential 24.5% upside from the current
share price.
three-year high
Bumi Armada, the second biggest mov-
er of the Energy Index on Tuesday, went
up 3.5 sen, or 6.25%, to 60 sen per share,
giving the group a market capitalisation of
by Emir Zainul RM3.52 billion.Year to date, the counter
theedgemalaysia.com has shot up 19% or nine sen.
In early January, Hong Leong Investment
Bank (HLIB) said Bumi Armada is poised
for sequential earnings growth in the com-
ing quarters, amid better quarter-on-quar-
Bursa Malaysia Energy Index
ter contributions from the Armada Kraken
points floating production storage and offloading
1000 (FPSO) unit.
For 2024, HLIB expects maiden con-
946.95
950 tributions from Armada Sterling V to serve
as a booster for the group’s earnings, pro-
900
883.84 jecting an 11.2% year-on-year increase in
its bottom line.
Dayang Enterprise, which has se-
850
cured at least five contract extensions so
far this year, climbed 13 sen or 5.99% to
800
RM2.30, as its market capitalisation stood
at RM2.66 billion.Year to date, the counter
750 has risen by 43.75% or 70 sen.
Feb 17, 2023 Feb 20, 2024
Source: Bloomberg
Read the full story
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4 8 TheEdge CEO morning brief

h o m e

Shahrill Basri/The Edge

CelcomDigi shifts
focus to boost CelcomDigi CEO
Datuk Idham Nawawi
average revenue said, “It will come to
a point where the

per account market has reached

a certain level that
[revenue from] every
new customer that we
bring in will be lower.”
by Anis Hazim
theedgemalaysia.com

KUALA LUMPUR (Feb 20): Celcom-

Digi Bhd, Malaysia’s biggest wireless
carrier by subscribers, is now focusing
on average revenue per account (ARPA)
instead of average revenue per user
(ARPU) mainly for its postpaid plan,
its top executive said on Tuesday.
Prioritising ARPA would allow Cel-
comDigi to increase the overall revenue
from its existing accounts, chief execu-
tive officer Datuk Idham Nawawi said
at an earnings briefing. The company
will also be able to assess total revenue
from the whole cohort of customers,
he noted.
“It will come to a point where the
market has reached a certain level that
[revenue from] every new customer that
we bring in will be lower,” Idham said.
“So now we are growing and expand- scribers to 20.6 million as of FY2023.
ing the base.” Additionally, CelcomDigi deputy
Earlier in the day, CelcomDigi re- CEO Albern Murty said the ARPA ap-
ported that its net profit more than proach aims to retain existing customers
tripled in the fourth quarter of 2023 as well as to encourage them to subscribe
following its merger but flagged higher to a broader range of services offered.
costs ahead. “The total account is either on fam-
Net profit for the three months end- ily lines plan or home fibre plan, this is
ed Dec 31 was RM435.11 million com- how we see the ARPA growth,” he said.
pared to RM127.36 million over the Shares in CelcomDigi settled up four
same period the prior year, CelcomDigi sen or 0.92% to RM4.37 on Tuesday,
said in a stock exchange filing. Revenue giving the telco a market capitalisation
for the quarter surged 50% year-on-year of RM51.27 billion.
to RM3.27 billion from RM2.18 billion.
Blended ARPU was RM42 while its
subscribers base grew about 466,000 Read also: CelcomDigi 4Q profit more
in 2023 alone, bringing its total sub- than triples, flags higher costs ahead

SunCon posts
KUALA LUMPUR (Feb 20): Sunway The group also declared a single-tier
Construction Group Bhd (SunCon) on second interim dividend of three sen per

Tuesday reported a 7.93% increase in net
profit for the fourth quarter thanks to high-
er progress billings and output at its pre-
cast segment.
7.9% rise in 4Q
ordinary shares for the quarter.
At home, SunCon said it remains active-
profit, raises 2024 ly involved in data centre initiatives, having
secured its second data centre project in

order book target

Net profit for the three months ended
Dec 31, 2023 was RM49.27 million or 3.82
sen per share, compared to RM45.65 mil-
lion or 3.54 sen per share over the same pe-
riod the prior year, the group said in a stock
exchange filing. Revenue for the quarter
surged 73.11% year-on-year to RM871.50
million from RM503.43 million.
“Going forward, the group is actively
pursuing opportunities in the advanced
technology facilities,” said group manag-
ing director Liew Kok Wing. “We also look
forward to the rollout of mega infrastruc-
Johor and actively pursuing more oppor-
tunities in this sector. Further, SunCon
is “actively participating in various ware-
housing and semiconductor manufacturing
by Luqman Amin tenders”, he said.
theedgemalaysia.com On the international front, SunCon
has substantially completed the physical
works for the Meensurutti-Chidambaram
Sunway Construction Group Highway projects and aims to receive the
Bhd’s quarterly earnings commercial operations issuance in the first
(RM mil) Net profit Revenue quarter of 2024, Liew added.
50 1000 Shares in SunCon closed one sen or
0.38% higher at RM2.61, valuing the com-
673.5

ture projects in the pipeline arising from the 800 pany at RM3.36 billion.
624.7

604.1

40
871.5
557.9

522.1

continued growth in the economy.”

503.4
469.3

For 2024, SunCon said it is aiming for 30 600

a higher order book target of RM2.5 bil- Other earnings results:
20 400
lion to RM3.0 billion. Outstanding order
book totalled RM5.3 billion after securing 10 200 Gas Malaysia 4Q profit up 9% on lower
34.5
32.3
22.7
45.6
27.8
33.0
35.0
49.3

RM2.505 billion in new orders last year.
For the full-year FY2023, net profit
was RM145.11 million, up 7.34% from
RM135.18 million recorded in FY2022,
while revenue increased 23.94% to RM2.67
billion from RM2.16 billion.
tax expense, declares 8.42 sen dividend
0 0
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
FY2022 FY2023
KLK and Batu Kawan report lower
Note: Financial year ends on Dec 31
Source: Bursa Malaysia earnings in 1QFY24, dragged by
downstream activities
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
Hume Cement’s
bumper profit
continues for fourth
consecutive quarter
by Adam Aziz
theedgemalaysia.com
KUALA LUMPUR (Feb 20): Hume Ce-
ment Industries Bhd posted its fifth con-
secutive quarter of earnings growth in the
quarter ended Dec 31, 2023 (2QFY2024),
as net profit rose 13-fold year-on-year
(y-o-y) to RM59.06 million, on improved
cement selling prices and sales volume.
It was the cement producer’s best quar-
terly performance since 3QFY2003, when
it booked RM190.57 million — due to
the RM187.7 million disposal of Malex
Industrial Products Sdn Bhd at the time.
The latest quarter would be its best nor-
malised quarter since listing.
Quarterly earnings per share rose to
10.7 sen, compared with 0.89 sen per share
a year ago, when it booked a net profit of
RM4.47 million.
KUALA LUMPUR (Feb 20): Supermax
Corp Bhd reported a net loss of RM44.36
million for its second quarter ended Dec
31, 2023 (2QFY2024), extending the
group’s loss-making streak to five consec-
utive quarters, as glove demand and average
selling prices (ASPs) remained weak amid
heightened competition.
The latest net loss is 21 times higher than
the RM2.05 million it incurred in the im-
mediate preceding quarter of 1QFY2024,
though it has narrowed by 59% from the
RM108.07 million it posted for 2QFY2023.
Loss per share stood at 1.72 sen com-
pared with 2QFY2023’s 4.01 sen, accord-
ing to the group’s disclosure to the local ex-
change.
Quarterly revenue shrank by 16.7% to
RM145.55 million from RM174.79 million
in 2QFY2023. The group attributes this
to continued weak demand as buyers run
down overstocked positions post-pandem-
ic and low ASPs due to stiff competition,
particularly from Chinese manufacturers
capitalising on low utility costs.
The reduced year-on-year losses were
mainly contributed by significantly lower
forex losses and higher interest income.
In contrast, the widened quar-
ter-on-quarter losses were not only due
to a revenue decline from the RM145.55
million recorded for 1QFY2024, but also
9 TheEdge CEO morning brief
h o m e
Hume Cement Industries Bhd earnings
Net profit (RM mil)
60
50
40
30 255.3
20
191.8 213.3 206.8
10
0 0
-10 1.9 4.9 -12 4.5
-20
3Q 4Q 1Q 2Q
FY22
Source: Bursa Malaysia
Revenue rose 26.24% to RM322.25
million, from RM255.27 million in
2QFY2023. The top line has been grow-
ing by 6% per quarter in the last four quar-
ters since 2QFY2022, after bottoming out
from the pandemic low in 2022.
On a quarter-on-quarter (q-o-q) basis,
Hume Cement’s net profit rose 22.21%
from RM48.33 million, as revenue rose
5.08% q-o-q from RM306.66 million.
The latest results helped Hume return
to the black for the six months ended Dec
31, 2023 (1HFY2024), with a net profit of
RM107.39 million or 20.21 sen per share,
from a net loss of RM7.57 million or 1.5
Supermax says Chinese
players likely taken over
global glove leadership
as it posts another
loss-making quarter
by Choy Nyen Yiau
theedgemalaysia.com
a sizeable impairment for stocks, and as it
recorded forex losses instead of forex gains.
For the first six months of FY2024
(1HFY2024), the group’s net loss dropped
54.7% to RM46.41 million from RM102.36
million in 1HFY2023, while revenue
dropped 23.5% to RM323.52 million from
RM422.75 million.
Unfavourable outlook to persist in 2024,
with continued squeeze on margins
On prospects, the group acknowledges that
the rubber glove market remains lacklus-
tre with an unfavorable outlook for 2024
due to ongoing demand-supply dynamics
post-pandemic.
“At the two most recent large interna-
tional trade shows, the takeaway was that the
oversupply situation is expected to moderate
Revenue (RM mil)
600
500
289 263.2
306.7 322.3 400
300
200
100
27 40.6 48.3 59.1 -100
-200
3Q 4Q 1Q 2Q
FY23 FY24
sen per share in 1HFY2023.
Half-year revenue rose 36.11% to
RM628.91 million, from RM462.06 mil-
lion, its filing showed.
Hume Cement, 71%-controlled by
Hong Leong Group, noted “improvement
in construction activities” on the recent
better performance, and said it expects
the sector “to sustain its momentum” in
the current financial year.
Shares of the cement manufacturer set-
tled nine sen or 3.16% higher at RM2.94
on Tuesday, giving it a market capitalisa-
tion of RM1.84 billion. The counter has
risen by 30.67% this year.
gradually over an extended period as more
and more smaller players exit the market,
while bigger players scale back expansion and
retire older factories and production lines.
“The industry is basically going through
a consolidation stage at this time,” the
group said.
Moreover, the group notes that ASPs
remain suppressed, with manufacturers
from China proving to be daunting com-
petitors and believed to have taken over the
global leadership from Malaysia, at least in
terms of pricing.
Supermax does not expect to see a sig-
nificant improvement in performance for
the rest of the year 2024 due to the high
volume of high-priced stocks at its overseas
distribution centers.
Supermax said cost management meas-
ures have helped improve the group’s prof-
itability to an extent, but high material costs
and utility costs, currently and going for-
ward, are expected to result in a continued
squeeze on margins.
Read the full story
More on corporate earnings: Globe-
tronics flags persisting headwinds for chip
industry as 4Q profit nearly halves
W E D N E S D AY F E B R U A RY 2 1 , 2 0 2 4 10 THEEDGE CEO MORNING BRIEF
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
Hibiscus 2Q net
profit jumps
45% on higher oil
prices, declares
two sen dividend
by Luqman Amin
theedgemalaysia.com
KUALA LUMPUR (Feb 20): Oil and gas
company Hibiscus Petroleum Bhd reported a
45.22% surge in its net profit for the second
quarter of financial year 2024 (2QFY2024)
from a year earlier, driven by higher average
realised oil prices and lower operating costs.
Net profit for the three months ended
Dec 31, 2023, rose to RM102.34 million or
12.72 sen per share, compared to RM70.47
million or 8.75 sen per share in 2QFY2023,
Hibiscus said in a bourse filing.
The group declared a second interim sin-
gle-tier dividend of two sen per share, higher
than the 0.75 sen per share paid in the pre-
vious corresponding quarter.
Quarterly revenue, however, slipped 12%
to RM627.55 million, from RM713.13 mil-
lion a year ago, mainly due to lower sales
volume and average realised gas prices.
KUALA LUMPUR (Feb 20): Star Media
Group Bhd reported a net profit of RM5.5
million for the fourth quarter ended Dec 31,
2023 (4QFY2023), marking a more than 14-
fold increase from the RM388,000 it made
in the same quarter a year ago despite lower
revenue, thanks to a disposal gain on invest-
ment property of RM6.48 million.
Earnings per share improved to 0.76 sen
from 0.05 sen, according to the media group’s
bourse filing on Tuesday.
Without the disposal gain, Star Me-
dia would have made a net loss of about
RM977,000 for 4QFY2023.
Quarterly revenue dipped 7% to RM55.1
million from RM58.97 million, due to lower
revenue in both its print, digital and events
segment, and radio broadcasting segment.
Its core print, digital and events segment
incurred a loss before tax (LBT) of RM2.5
million during the quarter, as compared to
a profiit before tax (PBT) of RM1.2 million
previously, as revenue slid 9% to RM45.6
million from RM49.9 million due to weaker
market sentiment.
Its radio broadcasting business also fell into
the red with an LBT of about RM100,000 from
a PBT of RM1.1 million, as revenue dropped
25% to RM6.5 million from RM8.7 million on
lower contribution from commercial airtime.
11 TheEdge CEO morning brief
h o m e
Hibiscus Petroleum Bhd’s quarterly earnings
Net profit (RM mil)
350 868.4
300
713.1
250
200
604.8
150 297.1
100
50
307.5 215.5 135.3 70.5
0 0
3Q 4Q 1Q 2Q
FY22
*Financial year ends on June 30 Source: Bursa Malaysia
For the first half of financial year 2024
(1HFY2024), net profit increased 24.74%
to RM256.63 million, from RM205.73 mil-
lion recorded in 1HFY2023, following a 4%
growth in revenue to RM1.37 billion from
RM1.32 billion in the same period the pri-
or year.
On its outlook, Hibiscus projected to sell
a total of 7.7 million barrels of oil equiva-
lent (MMboe) for FY2024, with an average
production cost of US$16.50 (RM79.10)
per barrel of oil equivalent, which is in line
with the guidance of approximately 7.5 to
7.8 MMboe provided earlier
As at the 2QFY2024, Hibiscus managed
to sell a total of 1.2 million barrels of oil and
condensate as well as 0.7 MMboe of gas.
Year-to-date, a total of 3.9 MMboe of oil,
condensate and gas sold.
Star Media’s 4Q
profit jumps on
disposal gain
by Choy Nyen Yiau
theedgemalaysia.com
Only its property development and in-
vestment segment was in the black during
the quarter with a PBT of RM7.7 million
compared with an LBT of RM900,000, due
to the recognition of the disposal gain.
For the full year FY2023, Star Media’s
net profit climbed 8.22% to RM7.49 mil-
lion from RM6.92 million in FY2022, while
revenue was little changed at RM220 million
compared with RM219.94 million previously.
The group’s print, digital, and events seg-
ment recorded an LBT of RM1.3 million in
FY2023, compared to a PBT of RM4.5 million
in FY2022, primarily due to higher operating
costs.The segment’s revenue slid to RM184.1
million in FY2023 from RM184.7 million in
FY2022, despite challenging market conditions.
The group’s radio broadcasting segment’s
PBT dropped to RM100,000 from RM7.2 mil-
Revenue (RM mil)
1000
746.6
800
627.6
523.3 600
503.6
400
71.5 123.3 154.3 102.3
200
3Q 4Q 1Q 2Q
FY23 FY24
Hibiscus managing director Kenneth
Pereira said the earnings were underpinned
by a continuous “strong operational” per-
formance from the previous quarters, as
evidenced by the company’s success in in-
creasing the average production levels to over
22,000 barrels of oil equivalent per day for
the first time in a single quarter.
For supporting this, operations in the UK
has also received an offer award of a further
two blocks located in the Quad 15 area of
the Central North Sea, following the offer
of three blocks in the first tranche of the
33rd UK Offshore Licensing Round, Hi-
biscus added.
Shares in Hibiscus settled at three sen
or 1.17% higher to RM2.60 at the mid-
day break on Tuesday, valuing the group at
RM2.09 billion.
lion in FY2022, as revenue fell 19% to RM27.2
million from RM33.6 million, mainly due to
lower market spend for the radio industry.
Its property development and investment
business recorded PBT of RM8.1 million,
compared with an LBT of RM4.2 million
previously, as revenue grew to RM12.3 mil-
lion from RM3.2 million on the recognition
of revenue from the sale of Star Business
Hub units and higher occupancy rates of
the group’s properties.
Moving forward, the group expressed its
commitment to exploring new revenue streams
while maintaining operational and cost efficien-
cies, given the cautious industry outlook regard-
ing advertising expenditure in 2024.
The group also said it remains cautiously op-
timistic about the ongoing positive contribution
of the property development and investment
segment to its revenue and profitability, while
it pursues potential merger and acquisition op-
portunities to enhance its existing businesses.
Shares in Star Media finished half a sen or
1.24% higher at 41 sen, giving the group a
market capitalisation of RM302.81 million.
Editor’s note: The Edge Communications
Sdn Bhd, which publishes The Edge Malaysia,
has a 5.17% interest in Star Media Group
Bhddia Group Bhd
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
Proton hints
about launching
new energy
vehicles soon
Bernama
KUALA LUMPUR (Feb 20): National
car maker Perusahaan Otomobil Nasional
Sdn Bhd (Proton) on Tuesday hinted that
it will launch several models of new energy
vehicles (NEV) soon.
“We will launch (the models) very
soon. We will launch one model, maybe
in the next six and eight months later,
we will launch the second one (which
KUALA LUMPUR (Feb 20): Malaysia’s
vehicle sales rose 31% in January this year
from a year earlier, but fell month-on-
month due to the year-end rush of deliv-
eries and bargains.
Total industry volume was 65,499 units
in January 2024 versus 50,168 units in
the same month of 2023, the Malaysian
Automotive Association (MAA) said in a
statement. Volume was 16% lower, when
compared to that in December 2023.
“Sales in February 2024 is expected
to be lower than January 2024” due to
the shorter working month from the Chi-
nese New Year holidays, said the trade
body, which represents more than a doz-
en domestic and foreign brands, assem-
blers, distributors and retailers in the
country.
Sales of passenger vehicles totalled
59,394 units in January 2024, a 33% in-
crease from 44,586 units in January 2023,
while that of commercial vehicles climbed
Malaysia monthly total industry volume
Number of vehicles
80,000
60,000
40,000
20,000
50,168
63,544
78,895
47,800
63,154
62,601
0 ities at Sekolah Kebangsaan (SK) Sauja-
Jan Feb Mar Apr May June July Aug Sept Oct
2023
Source: Bloomberg
12 TheEdge CEO morning brief
h o m e
includes other non-NEV models as
well),” said chief executive officer Dr
Li Chunrong.
Li said this during his presentation on
Proton’s ‘Future Plan Product Strategy’
at the company’s Chinese New Year Pros-
perity Dinner on Tuesday, which was at-
tended by various media outlets.
He also said Proton is planning to grow
its powertrain portfolio with the launch of
a new-generation engine, offering a more
competitive advantage in the market.
“Proton also intends to capture the
number one ranking in after-sales ser-
vice,” he added.
In 2023, Proton achieved its fifth con-
secutive year of sales growth with total sales
(domestic and export) of 154,611 units, its
strongest sales performance since 2012.
This represented a 9.3% increase over
the 141,432 units sold in 2022.
MAA: Malaysia’s
vehicle sales
rose 31% y-o-y in
January 2024, may
fall in February
by Jason Ng
theedgemalaysia.com
9% year-on-year (y-o-y) to 6,105 units,
from 5,582 units.
Production of passenger vehicles was
up 31% to 71,666 units in January this
year, from 54,663 units, while output of
commercial vehicles was 14% higher at
4,411 units, against 3,864 units in the
same month of 2023.
64,765
72,836
68,187
76,147
73,242
78,398
65,499
Nov Dec
2024
Selangor: 564
development
projects worth
RM3.41 bil to be
implemented
this year
Bernama
SHAH ALAM (Feb 20): A total of 564
balanced and sustainable development
projects will be implemented this year
in Selangor under the Fourth Roll-
ing Plan (RP4) of the 12th Malaysia
Plan (12MP) with a total allocation of
RM3.41 billion.
The Selangor State Development Of-
fice, under the Implementation Coordi-
nation Unit of the Prime Minister’s De-
partment, in a statement said of the total
number, 463 are new projects whereas
101 are extension projects.
Through this effort, the Selangor
RP4 focuses on the development of
471 physical projects (RM2.25 billion
or 65.8%) involving the main project
scope including equipment, information
as well as communication technology
(ICT) and non-ICT equipment, pur-
chase of buildings, construction, facility
management, maintenance, land acqui-
sition and research.
“Meanwhile, 93 projects (RM1.17
billion or 34.2%) are non-physical pro-
jects approved for fund financing, ICT
programmes, research and training pro-
grammes,” according to the statement.
The matter was known following the
Selangor State Development Action
Council (MTPNg) meeting, chaired
by Selangor Menteri Besar Datuk Seri
Amirudin Shari on Tuesday, and attend-
ed by all heads of departments at the
federal and state levels in Selangor.
The statement said that as of Feb 13,
Selangor had achieved an expenditure
performance of 8.39%, and it surpassed
the national performance of 6.03%.
According to him, the projects expect-
ed to be completed this year include the
construction of the National Centre for
Food Safety (NCFS) in Sepang, the up-
grading project for the Kajang Hospital,
Kem Wawasan Negara Tanjung Rhu in
Sepang as well as the construction of a
new 24-classroom school and other facil-
Jan na Putra, in Telok Datok, Kuala Langat.
Read the full story
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
PORT KLANG (Feb 20): Swift Haulage Bhd
is expecting its warehousing business to grow
further to contribute up to 25% of its total
revenue in the next three to five years, from
15% currently, as the country’s largest haulage
operator expands its warehousing capacity on
the back of strong demand for such services.
This was evident following supply chain
disruptions during the Covid-19 pandem-
ic, to the more recent Red Sea crisis, said
Swift Haulage group chief executive officer
Loo Yong Hui.
“In the coming years, we are going to
expand our warehousing capacity. We still
have a lot of land banks, vacant land. Just
this land here [in Westports], is about 50
acres, and we’ve only used less than 10 acres
for this new warehouse, so there are avail-
able lands to expand. We [also] have land
banks throughout Malaysia, including in
Penang and Johor,” Loo told the press after
the launch of the group’s latest warehouse
and haulage office here.
“So, we hope in the next three to five
years to build up our warehousing busi-
ness, to possibly contribute up to 25% of
[the group] revenue,” Loo said.
According to Loo, the group is targeting to
build one warehouse per year. The capex to
construct a warehouse ranges between RM30
million and RM40 million, depending on the
size of the warehouse, which could vary be-
tween 150,000 sq ft to 200,000 sq ft.
The group currently has a total of 1.6 mil-
lion sq ft of combined warehousing space.
The haulage division is the group’s larg-
est revenue contributor at present, making
up 75% of its total revenue. The remain-
ing 10% of group revenue comes from the
freight forwarding segment.
KUALA LUMPUR (Feb 20): Tun Dr
Mahathir Mohamad is currently still
being treated at the National Heart In-
stitute (IJN) and is in the process of
recovering from an infection.
An aide to the former prime minister
provided an update on the condition of
the hospitalised Mahathir.
“I can’t say when he will be dis-
charged, until and unless the IJN is sat-
isfied with his level of recovery,” he said.
Last week, Mahathir was warded at
IJN for an unspecified infection.
“Tun (Mahathir) is currently re-
ceiving treatment for infection at IJN,
followed by a subsequent rest period
for optimal recovery,” the spokesper-
son said in a brief update last Tuesday
(Feb 13).
Mahathir’s health troubles were re-
vealed during proceedings for his civ-
13 TheEdge CEO morning brief
h o m e
On the expansion of the service tax
Swift Haulage scope to include logistics services, albeit
at a lower 6% rate and not the 8% pro-
sees warehousing posed for most other sectors, Loo said the
additional costs will likely be passed on
revenue to customers, pending final clarity from
the government on the implementation
contribution of the tax.
The government had announced dur-
increasing to 25% ing last October’s tabling of Budget 2024
that the service tax would be raised to 8%
in next three years from 6%, and the tax scope would be ex-
panded to cover logistics, brokerages and
karaoke services.
by Justin Lim Some lawmakers, however, have raised
theedgemalaysia.com concerns that the tax hike and the inclu-
sion of the logistics services, in particular,
Suhaimi Yusuf/The Edge would burden consumers with increased
costs of goods.
Subsequently, Prime Minister Datuk
Seri Anwar Ibrahim clarified in Novem-
ber that the inclusion of the logistics sector
under the service tax scope would be re-
fined, and that the tax rate for the logistics
services would be 6%. At the time, he also
said the government had not ruled out the
possibility of granting exemptions to certain
sub-sectors if it is found to directly affect
the public’s interest.
For the nine months ended Sept 30,
2023 (9MFY2023), Swift Haulage’s net
profit rose 23.02% to RM48.25 million
from RM39.22 million in 9MFY2022, as
revenue rose 3.8% to RM497.9 million
against RM479.67 million in the same
period last year.
At 3.35pm, the share price of Swift
Swift Haulage group CEO Loo Yong Hui said they Haulage was down half a sen or 0.9% to
are going to expand their warehousing capacity 55 sen, bringing the group a market capi-
as they have a lot of land. talisation of RM490 million.
Mahathir in
process of
recovering from
infection, says aide
by Surin Murugiah
theedgemalaysia.com
il defamation suit against Deputy Prime
Minister Datuk Seri Dr Ahmad Zahid
Hamidi on Feb 13, which were deferred
due to Mahathir’s absence.
Mahathir’s lawyer Mior Nor Haidir Su- Former PM Tun Dr Mahathir Mohamad is
haimi informed the court that his client currently still being treated at the National
was warded at IJN and had been advised Heart Institute and is in the process of
recovering from an infection.
to be on medical leave.
 W E D N E S D AY F E B R U A RY 2 1 , 2 0 2 4
KUALA LUMPUR (Feb 20): The pow-
er to grant an individual a pardon is not
the sole prerogative of the Yang di-Per-
tuan Agong, and the decision to do so is
potentially not immune to be reviewed
by the courts, according to constitutional
expert Emeritus Professor Datuk Dr Shad
Saleem Faruqi.
Shad said the Federal Constitution out-
lines the basic process for the King to ex-
ercise the power of pardons, and therefore
makes it not a prerogative of the ruler.
“I humbly submit that the word prerog-
ative is an error of jurisprudence. Preroga-
tives are by definition inherent, non-statu-
tory, common law attributes of monarchy,”
Shad said, referring to court rulings in rela-
tion to pardons.
“The use of prerogative is suitable for the
UK, where there is an unwritten constitu-
tion, but wholly inappropriate for Malay-
sia,” he added when speaking at a forum on
reforms to the Pardons Board on Tuesday.
Shad, the holder of the Tunku Abdul
Rahman chair at Universiti Malaya, noted
that the Constitution clearly stated that the
King is to exercise the power of pardon on
the advice of the Pardons Board. It is not
the King’s sole discretion unlike in the case
of emergency powers.
Shad also disagrees with the view that
pardons are non-justiciable or unsuitable for
a court to decide on, saying that there is no
such thing as absolute discretion.
An example he provided is that under
Article 42(12) of the Constitution, the King
Shafee: ‘Pardon decision based on votes’ claim premised
on hints in official decision document
KUALA LUMPUR (Feb 20): Datuk Seri
Najib Razak’s lawyer Tan Sri Muhammad
Shafee Abdullah claimed that he ascer-
tained that the Pardons Board undertook
a voting process to decide on the former
prime minister’s pardon petition, based on
“hints” in the official document that in-
formed him and his client of the decision.
Shafee said that the hearings of the Par-
dons Board are guarded behind the Offi-
cial Secrets Act 1972, but noted that the
document announcing the decision to the
petitioner, which he presented to the press
on Feb 7, are privileged public documents.
“I just showed the first page, the rest
I didn’t. I only shared [the cover] with
the seal of the Yang di-Pertuan Agong.
The content I never shared because I
didn’t get permission from my client.
[The documents] are not [an official se-
cret],” Shafee said during a forum on re-
forms to the Pardons Board on Tuesday.
14 THEEDGE CEO MORNING BRIEF
H O M E
Pardon not King’s
sole prerogative,
potentially
reviewable in
court, argues
Shad Faruqi
BY IZZUL IKRAM
theedgemalaysia.com
ZAHID IZZANI/THEEDGE
Emeritus Professor Datuk Dr Shad Saleem Faruqi
said the Federal Constitution outlines the basic
process for the King to exercise the power of
pardons, and therefore makes it not a prerogative
of the ruler.
BY IZZUL IKRAM
theedgemarkets.com
“It is a public document, it is a deci-
sion. It is not accessible, but it ought to
be,” he added.
When asked whether he plans to pub-
licise the document, Shafee said he does
not have Najib’s permission, but noted
that one can piece together “virtually the
full picture” of the documents based on
pictures snapped by the media, particu-
larly mentioning The Edge.
Subsequently, in response to a ques-
tion on how Shafee ascertained the on-
goings of the board’s hearing, particularly
how a voting process took place, the law-
yer said the claims were purely based on
“hints” he identified in the document.
“It’s very easily answered, the issue
of whether votes were taken or not, was
clearly hinted in the document, I read
or state ruler is disqualified from the chair
of the Pardons Board if it involves exercising
the power for their partner or children. Shad
claimed that in the event the board contra-
venes that subsection, the pardon may be
justiciable in court.
Earlier this month, the Pardons Board
halved former prime minister Datuk Seri
Najib Razak’s jail sentence to six years and
reduced his fine from RM210 million to
RM50 million. Najib is serving the sentence
after being found guilty of all seven charges
related to the misappropriation of RM42
million of SRC International Sdn Bhd funds.
The reduction in the sentence came as
a shock to various quarters, raising critical
comments and questions about the integ-
rity of Prime Minister Datuk Seri Anwar
Ibrahim’s administration’s battle against
corruption.
Najib’s lawyer Tan Sri Muhammad Sha-
fee Abdullah subsequently said the former
prime minister would file a fresh application
for a full pardon.
Shafee claimed that the Pardons Board
did not act in accordance with its role in
the Constitution. According to him, while
the King can hear the views of the board —
comprising the Attorney General, Minister
of Federal Territories and three others — the
decision is to be the King’s, and his alone.
Shafeee said the law makes it clear that
the “royal prerogative of mercy” is the sole
discretion of the King and is unfettered and
non-challengeable in any court, something
which Shad disagrees.
it as such,” he said.
He did not speak on how he knew of
the King’s purported intent to give Na-
jib a full pardon nor how he knew when
and how long the board’s discussions
took place, as he previously said during
the press conference on Feb 7.
At the press conference, Shafee said
he got the story on what transpired dur-
ing the Pardons Board meeting through
reliable reports.
Shafee had also previously announced
that Najib would be filing a fresh appli-
cation for a full pardon, unsatisfied with
how the Pardons Board conducted itself
in making its decision to halve Najib’s jail
sentence to six years and reduce his fine
from RM210 million to RM50 million.
Read also: Ex-Bar president lambasts law-
yer Shafee on alleged misleading statements
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
PUTRAJAYA (Feb 20): A three-member
Federal Court bench on Tuesday grant-
ed leave to former MyWatch chairman R
Sri Sanjeevan to appeal a Court of Appeal
(COA) decision overturning his compen-
sation for damages for unlawful detention
following his arrest in 2016.
Federal Court judges Datuk Mary Lim
Thiam Suan and Datuk Abdul Karim Ab-
dul Jalil allowed Sanjeevan’s motion while
Datuk Rhodzariah Bujang dissented.
“The court allows leave to only one of
the four questions to be determined by
the court,” Lim said.
The bench allowed the question which
it amended to as follows: Where an order
issuing the writ of habeas corpus is made
in relation to the remand of a person, is
it a necessary implication of such order
that the detention was not affected in ac-
cordance with the law under Article 5(2),
Federal Constitution (FC), and was thus
unlawful for contravening Article 5(1), FC
and amounting to false imprisonment?
In civil appeals at the apex court, leave
has to be obtained before the substantive
appeal is heard on its full merits to ensure
that the appeal is not frivolous.
Sanjeevan’s counsel Datuk Malik Imtiaz
Sarwar said the High Court had granted
Prosecution
appeals to
Federal Court
over Samirah’s
acquittal in
Cradle Fund CEO
murder case
by Hafiz Yatim
theedgemalaysia.com
PUTRAJAYA (Feb 20): The prosecution
is appealing to the Federal Court against
the appelate court’s decision to uphold the
acquittal of Samirah Muzaffar and two
teenagers over the murder of former Cra-
dle Fund Sdn Bhd chief executive officer
Nazrin Hassan in 2018.
A prosecutor familiar with the matter
confirmed with The Edge that the notice
of appeal was filed on Feb 13.
On Feb 8, a three-member Court of
Appeal bench, led by judge Datuk Vazeer
Alam Mydin Meera, unanimously upheld
the High Court’s decision to acquit the trio
15 TheEdge CEO morning brief
h o m e
Apex court allows
former MyWatch
activist’s appeal
for compensation
by Hafiz Yatim
theedgemalaysia.com
reuters
Sanjeevan’s claim for damages as it ruled
that he was unlawfully detained under Pre-
vention of Crime Act 1959 (Poca), as his
habeas corpus application was granted.
Malik said the COA’s decision to over-
turn the High Court’s decision was not
without their defence being called.
“The bench affirms the Shah Alam
High Court’s findings and the appeal by
the prosecution is dismissed,” Vazeer, who
sat together with judges Datuk Ahmad
Zaidi Ibrahim and Datuk Azahari Kamal
Ramli, had said in his judgment.
Samirah, 48, who is Nazrin’s widow,
was charged with the two teenagers who
are now 21 and 18, along with their former
Indonesian maid Eka Wahyu Lestari, who
is still at large, with killing Nazrin, 45, at
entirely correct, as the approach by the
appellate court was wrong, raising ques-
tions which warranted Federal Court in-
tervention.
Poca, Malik said, should only be used
for allegations of organised violence, and
in this case, Sanjeevan does not fall in that
category, and hence the detention should
be deemed unlawful.
Senior federal counsels Mohammad Al
Saifi Hashim and Andi Razalijaya A Dadi
opposed the granting of leave as they ar-
gued that the appellate court had rightfully
ruled that the detention was lawful.
The High Court had awarded San-
jeevan RM40,000 in damages as it found
that the Inspector-General of Police and
the government were both vicariously li-
able to pay.
The COA ruled on Sept 15 last year
that the High Court judge had misdirected
itself and that it warranted appellate inter-
vention as it ruled that allowing damages
would open the floodgates to other claims.
Sanjeevan was detained for 15 days be-
tween July 11 and 26, 2016 under Poca.
His detention was deemed unlawful and
illegal and declared null and void as ha-
beas corpus was granted by the court on
July 26, 2016.
bloomberg
his house in Mutiara Damansara between
11.30pm on June 13, 2018, and 4am the
following day.
The High Court had acquitted them
on June 21, 2022 after ruling that a prima
facie case had not been established at the
end of the prosecution stage of the trial
Read also: Najib’s appeal to reinstate
RM1.9 mil malfeasance suit against
ex-AG rescheduled to November
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
Thai PM calls for
emergency rate
cut, pressuring
central bank
by Suttinee Yuvejwattana
Bloomberg
(Feb 20): Thailand’s Prime Minister
Srettha Thavisin asked the central bank
to urgently hold an unscheduled meet-
ing of its Monetary Policy Committee
(MPC) to cut interest rate, saying the
latest data indicated that the nation’s
economy was in a crisis.
“I would like to implore the MPC to
urgently call a committee meeting to con-
sider reducing interest without waiting
for a scheduled meeting,” Srettha posted
on X, formerly known as Twitter, late on
Monday.
The rate-setting panel headed by
the Bank of Thailand (BOT) governor
Sethaput Suthiwartnarueput isn’t sched-
uled to hold its regular meeting until
April 10.
The baht fell as much as 0.3% on news
of Srettha calling for an out of cycle MPC
meeting to cut borrowing costs that are at
a decade high.The currency has gone from
being the best performer in Asia in the fi-
nal quarter of 2023, to the second worst
this year, as foreign investors continued to
shun Thai assets.
“This call represents rising headwinds
for the baht, given the apparent escalation
(Feb 20): Bank of England (BOE) Gover-
nor Andrew Bailey said inflation does not
need to fall to its 2% target before policy-
makers back an interest-rate cut.
Bailey told Parliament’s Treasury Com-
mittee on Tuesday that the market’s bets
on rate reductions this year are “not un-
reasonable” as he played down the signif-
icance of the UK entering recession.
The comments suggest the central bank
is beginning to turn its attention to un-
winding its aggressive series of rate rises
as inflation subsides. While inflation is ex-
pected to temporarily fall to target in the
spring, policymakers are closely watching
the jobs market and services inflation for
signs of persistent price pressures easing
before relaxing their grip.
“We don’t need obviously inflation to
come back to target before we cut interest
rates. I must be very clear on that, that’s
not necessary,” Bailey said.
16 TheEdge CEO morning brief
w o r l d
of pressure on the central bank to cut be-
fore the next meeting in April,” said Moh
Siong Sim, a currency strategist at Bank
of Singapore Ltd. “The baht is likely to
remain under pressure in the near term,
amid a firm dollar backdrop.”
While the BOT hasn’t reacted to the
latest GDP data, central bank officials
have previously said that they are willing
to consider lowering borrowing costs if
they are convinced that the weakness in
the economy is persistent and not tran-
sitory. The rate-setting panel left interest
rate unchanged at 2.5% on Feb 7, ignor-
ing Srettha’s call for a 25 basis point cut.
Gross domestic product expanded
1.7% in the fourth quarter from a year
ago, markedly weaker than the median
2.6% forecast by economists surveyed by
Bloomberg, data released by the National
Bailey says BOE
can cut rates
before inflation
returns to target
by Tom Rees
Bloomberg
He said there had been “encouraging
signs” on the key indicators being monitored
by the BOE but stressed that policymakers
are looking for “sustained progress”.
Markets shifted forward their bets on
interest-rate cuts following the remarks. In-
vestors currently predict that the first rate
reduction will arrive in August and now
expect three quarter-point cuts in 2024.
Economic and Social Development Coun-
cil showed on Monday. Output shrank
0.6% quarter-on-quarter, against a fore-
cast of a 0.1% drop. For the full year 2023,
the economy grew 1.9%, extending a dec-
ade of average sub-2% growth.
Thailand is currently witnessing a spell
of disinflation, with consumer prices print-
ing negative for four months since October.
Factory output has shrunk for 15 months
in a row, as exports took a knock due to
sluggish demand for automobiles, electron-
ics and other products.
The tepid economic recovery also bol-
sters the case for Srettha’s plan to shore up
growth with US$14 billion cash handouts
to citizens to boost consumption — an idea
that has been criticised by economists and
the central bank as inflationary, and one
that poses a risk to fiscal consolidation.
Bailey did not push back against the
market curve during Tuesday’s hearing.
“They think we’re going to cut rates
during the rest of this year,” Bailey said.
“We do not endorse the market curve. We
are not making a prediction of when or by
how much but I think you can you can tell
from that profile of the forecast — again
comparing it with the constant rate fore-
cast — that it’s not unreasonable for the
market to think that.”
The governor also played down the sig-
nificance of data last week showing the
UK fell into a technical recession in the
second half of last year.
He said the figures point to a “very weak
recession” and highlighted “distinct signs
of an upturn”.
Read also: Barclays focuses on Britain,
cost cuts, buybacks to win over investors
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
JAKARTA (Feb 20): Indonesian Presi-
dent Joko Widodo said on Tuesday he had
signed a regulation requiring digital plat-
forms to pay media outlets that provide
them with content, a move aimed at lev-
elling the playing field between the media
industry and big tech companies.
Digital platforms in Indonesia include
Meta Platforms’ Facebook, Alphabet Inc’s
Google and some local aggregators.
“The spirit of the regulation is... to en-
sure a fair cooperation between media and
digital platforms, provide clearer coopera-
tion framework between them,” said Joko-
wi, as the president is popularly known.
Google said it will review the regulation.
It has worked with news publishers and the
government to build a sustainable news eco-
system in Indonesia, its spokesperson said.
Facebook did not immediately respond
to requests for comment on Tuesday.
Google had last year said that the reg-
ulation would restrict public access to di-
verse sources of news instead of promoting
quality journalism.
Jokowi said the drafting process of the
regulation, proposed three years ago, had
TikTok violates
Indonesian in-app
transactions ban,
says minister
by Bernadette Christina
Reuters
JAKARTA (Feb 20): Chinese short vid-
eo app TikTok is still violating Indonesia’s
rule that bans in-app transactions, a cabi-
net minister said on Tuesday, after it took
control of the country’s biggest e-com-
merce platform to restart its online shop-
ping business.
TikTok had been forced to close its
relatively new e-commerce service, Tik-
Tok Shop, in Indonesia after the country
banned online shopping on social media
platforms last year, citing the need to pro-
tect smaller merchants and users’ data.
Indonesian tech conglomerate GoTo
said last month that TikTok, owned by
China’s ByteDance, had completed a
deal agreed in December to buy 75.01%
of Tokopedia for US$840 million (RM4.03
billion).
Teten Masduki, the Indonesian minister
for small and medium enterprises (SMEs),
who spoke frequently against TikTok Shop
prior to last year’s ban, told reporters that
17 TheEdge CEO morning brief
w o r l d
Indonesia issues
regulations
requiring digital
platforms to pay
media for content
Reuters
The spirit of the regulation
is... to ensure a fair
cooperation between media
and digital platforms,
provide clearer cooperation
framework between them.”
— President Joko Widodo
reuters
TikTok still had not complied with the
regulation.
“The trade minister has to reprimand
TikTok so that it complies with the reg-
ulation, if not then ... the government’s
authority is undermined,” he said.
A TikTok representative in Indone-
sia did not immediately respond to a
Reuters request for comment.
The trade ministry said it was still
considering how best to respond to the
issue.
TikTok said last year it intended to
invest billions of dollars in Southeast
Asia, including Indonesia, the region’s
biggest economy.
been very long due to different opinions
among media and digital platforms.
The regulation posted on the govern-
ment’s website suggests cooperation be-
tween digital platforms and media com-
panies could be in the form of paying
licences or sharing data of news users.
A committee would be formed to ensure
digital platforms fulfil their responsibilities
to the media companies, it said.
The regulation, which takes effect in six
months, would not harm content creators as it
applied only to digital platforms, Jokowi said.
Content creators had previously com-
plained it could restrict their operations.
Indonesia’s communication and infor-
mation minister, Budi Arie Setiadi, said in
a statement the regulation was part of gov-
ernment efforts to ensure media compa-
nies “are not eroded” by digital platforms.
In Australia, the News Media Bargain-
ing Code took effect in March 2021 and
tech firms have since signed deals with
media outlets compensating them for con-
tent which generated clicks and advertising
dollars, according to a report by its Treas-
ury Department.
Indonesia to offer
more energy blocks in
North Sumatra after
Mubadala discovery
by Fransiska Nangoy &
Bernadette Christina Munthe
Reuters
JAKARTA (Feb 20): Indonesia is looking to
offer more oil and gas blocks in the North
Sumatra basin this year, following a major
discovery by Mubadala Energy in a bid to
accelerate gas production, a senior energy
ministry official said on Tuesday.
The energy ministry is currently review-
ing potential energy blocks for auction this
year, director general for oil and gas Tutuka
Ariadji told reporters.
“[The] North Sumatra basin is one of the
potential areas for further exploration, after
a major discovery recently in Layaran-1 by
Mubadala Energy,” Tutuka said.
United Arab Emirates’ Mubadala said in
December that it had discovered a major deep
sea gas reserve through the Layaran-1 well in
South Andaman Block, off northern Sumatra.
Mubadala said the discovery has poten-
tial gas-in-place for more than six trillion
cubic feet (tcf), which according to analysts
was the world’s second-largest deep water
discovery last year.
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
SINGAPORE (Feb 20): Singapore Airlines
has reported a quarterly record revenue of
S$5.08 billion (RM18.13 billion) for the
3QFY2023/2024 ended Dec 31, 2023, as
demand for air travel rebounded in China,
Hong Kong, Japan and Taiwan.
The group says that this exceeded the S$5
billion mark for the first time in its history.
For the full 9MFY2023/2024, the group
recorded a revenue of S$14.24 billion, up
7.2% y-o-y from the same period a year
ago, driven by a 20.2% increase in passen-
ger flown revenue and partially offset by a
drop in cargo flown revenue.
The group recorded a 4.9% y-o-y increase
in its net profit of S$659 million, and a 35%
y-o-y increase for the full 9MFY2023/2024
to a record S$2.1 billion.
SIA says that this is mainly due to better
operating performance, a net interest ver-
sus net finance charges, and share of prof-
its versus a share of losses from associated
companies the previous year.
However, expenditure increased by 9.3%
y-o-y to S$4.47 billion for the quarter, which
included a S$261 million increase, or 9.5%
rise in non-fuel expenditure, and a S$121
million increase, or 9.1% rise in net fuel
(Feb 20): Cities around the world from
Bangkok to Detroit are fading from inter-
national flight networks as the post-Covid
travel boom funnels traffic into more tra-
ditional hubs.
Across Southeast Asia, pre-pandemic
links with Europe have all but vanished
as Philippine Airlines Inc, Garuda Indo-
nesia and Thai Airways International Pcl
cut flights.
Manila and Jakarta, for example, have no
direct services to London anymore, Kuala
Lumpur has lost access to Frankfurt, and
the Bangkok-Rome connection has evapo-
rated, according to February schedules from
aviation data provider Cirium. Only Singa-
pore, host to a major air show that kicks off
on Tuesday, is better connected.
The services that have survived to key
European destinations are almost all oper-
ating less frequently.
It’s a similar picture in America, where
residents in Detroit or even the capital Wash-
ington find themselves with fewer pathways
to Europe. In Florida, Fort Lauderdale had
more than 50 direct flights a month to Lon-
don and Paris five years ago, most of them
operated by Marabu Airlines and Norwegian
Air Shuttle ASA. Now the city has none, the
Cirium data show.
The disappearing connections for hun-
dreds of millions of people belie the broader
recovery in air travel since the pandemic.The
holes in the route network reflect systemic
challenges facing the industry: Airlines can’t
18 TheEdge CEO morning brief
w o r l d
Singapore Airlines
posts record
quarterly revenue
of over S$5 bil
by Nicole Lim
theedgesingapore.com
bloomberg
Singapore gains,
neighbouring cities
lose as airlines axe
less frequented
routes
by Angus Whitley & Danny Lee
Bloomberg
get their hands on enough new aircraft or
spare parts to meet passenger demand. At
the same time, rising costs are squeezing car-
riers’ margins, forcing them to scrap routes
that were economically viable before Covid.
The data suggest that the winners from
this incomplete rebound are the tradition-
al gateways like Singapore and New York,
which have cemented their roles as hubs by
becoming even better connected. Delta Air
Lines Inc and United Airlines Holdings Inc
are operating even more direct flights than
before the crisis from NewYork to major Eu-
ropean destinations like London and Paris.
Singapore Airlines Ltd is doing the same
thing from Changi Airport, its home base
in the city state.
Many Asian countries reopened their
borders just as global supply chain woes
started to hit the availability of planes and
cost.This rise in net fuel cost was mainly due
to the higher volume uplifted (S$176 mil-
lion), and a lower fuel hedging gain (S$109
million), according to the group. This was
partially offset by a 6.6% decrease in fuel
prices, at S$114 million.
As a result, SIA recorded a 19.3%
y-o-y decrease in its operating profit for
the 3QFY2023/2024 at S$609 million, a
decrease of $146 million from the previ-
ous year.
Group expenditure grew 7.2% y-o-y to
S$808 million, consisting of a S$1.1 bil-
lion increase in non-fuel expenditure and a
S$292 million drop in net fuel cost.This net
fuel cost fell to S$3.7 billion, mainly due to a
22.0% drop in fuel prices that was partially
offset by the higher volume uplifted and a
lower fuel hedging gain.
SIA and Scoot carried 9.5 million pas-
sengers, up 29.4% y-o-y, while passenger
traffic grew 19.1%, outpacing the capacity
expansion of 17.9%. As a result, the group’s
passenger load factor (PLF) improved by
0.8 percentage points to 88.2%.
Read the full story
components, said Subhas Menon, the direc-
tor general of the Association of Asia Pacific
Airlines. “Connectivity, even before Covid,
is a function of demand, supply, economics
and air transport regulation,” he said. The
Asia-Pacific region has probably suffered the
most in that respect, he said.
Problems to mull
Back in 2020, less than a year into the pan-
demic, about one third of the world’s 50,000
air routes had been wiped off the map by
border closures and nationwide lockdowns.
Even then, there were concerns that some
services might never come back.
Airline and aerospace executives are due
to discuss the scale of the recovery and air-
craft delivery delays when they gather this
week for the biennial Singapore Airshow.The
faltering supply of new jets has been exac-
erbated by the latest troubles at Boeing Co.
Aviation regulators in the US have increased
scrutiny of the planemaker’s manufacturing
— and capped 737 Max production — after
a panel blowout on an Alaska Airlines flight
in January.
It’s not just Asia and North America that
are losing connectivity.
Read the full story
Read also: Chinese tourists flock to South-
east Asia as overseas travel bounces back
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
China mortgage
rate will not
hurt banks’ net
interest margins
— media
by Winni Zhou & Tom Westbrook
Reuters
SHANGHAI/SINGAPORE (Feb 20):
China’s decision to deliver its biggest
reduction in the benchmark mort-
gage rate won’t create a negative im-
pact on banks’ net interest margins, a
central bank-backed news outlet said
on Tuesday.
The remarks made by the Financial
News come after China slashed its five-
year loan prime rate (LPR) by 25 basis
point on Tuesday, the largest reduction
since the loan rate mechanism was re-
vamped in 2019 and far more than an-
alysts had expected.
Net interest margins, a gauge that
measures the health of a bank, had
been trending lower last year against the
backdrop of subdued credit demand,
prompting major lenders to roll out
multiple rounds of deposit rate cuts to
improve their profitability.
“An important policy direction in
2024 is to promote the stable devel-
opments of the real estate industry, of
which moderately lowering household
mortgage interest rates is regarded as
a key move,” the newspaper said on its
official WeChat account.
It added that falling mortgage rates
would save household interest payments
and help a consumption recovery.
The newspaper also said that spillo-
ver effects from other major economies
are expected to decrease and offer lee-
way for Beijing to manoeuvre on mon-
etary policy.
“Considering that the Federal Re-
serve will most likely enter an interest
rate cut cycle this year, the inverted in-
terest rate gap between China and the
US is difficult to reverse in the short
term,” it said.
“Keeping the one-year LPR steady
while lowering the five-year rate will not
only maintain reasonable support for
the real economy, but also balance inter-
nal and external conditions to improve
our resilience and policy autonomy to
counter external shocks.”
19 TheEdge CEO morning brief
w o r l d
China’s state
banks step in to
arrest yuan slide
after mortgage
rate cut — sources
Reuters
SHANGHAI/BEIJING (Feb 20): Chi-
na’s major state-owned banks were seen
selling dollars on Tuesday, three people
with knowledge of the matter said, in an
attempt to arrest weakness in the yuan in
the wake of a deep cut to the benchmark
mortgage rate.
Chinese state banks were actively swap-
US asset
managers ready
for China rebound
with products
stacked up
by Suzanne McGee & Megan Davies
Reuters
(Feb 20): Three straight years of losses
from Chinese markets and anti-Beijing
rhetoric from Washington have not de-
terred some US asset managers from in-
troducing products they hope will thrive
if Chinese stocks rebound.
China’s markets have been hit by a
long-lasting property crisis, slowing
growth and geopolitical tension. The
Institute of International Finance esti-
mates US$80 billion (RM382.2 billion)
of outflows from Chinese portfolios last
year, and the bellwether blue-chip CSI
300 Index has fallen 43% from its record
high of three years ago. China’s markets,
which reopen on Feb 19 after the Lunar
New Year holidays, are down nearly 2%
year-to-date, bouncing off lows on sup-
port measures from Beijing.
Despite the extended pain, US fund
managers with China-focused products
have been betting that investors will want
to return to the market, arguing that val-
uations make the country hard to ignore.
China’s CSI 300 index currently trades
at 12 times trailing 12-month earnings,
ping yuan for dollars in the onshore swap
market before quickly selling those green-
backs in the spot market to support the
local currency, the sources said.
The state bank action comes as the Chi-
nese yuan weakened past the psychologi-
cally critical 7.2 per dollar level on Tuesday
after China announced its biggest-ever re-
duction in the benchmark mortgage rate
to revive the crisis-hit property market.
The sources declined to be identified
because they were not authorised to speak
publicly about market trades.
Chinese state-owned banks usually
trade on behalf of the nation’s central bank
in the foreign exchange market, but they
also trade on their own behalf.
Read also: China cuts mortgage refer-
ence rate more than expected to revive
property market
while the S&P 500 index’s valuation is at
24 times 12-month earnings, according
to Morningstar Direct.
“This is potentially a once-in-a-lifetime
opportunity to buy China equities at valu-
ation levels not seen for a long time,” Jon-
athan Krane, CEO of China-focused ETF
provider KraneShares, said in an email.
KraneShares has launched four new
China-focused exchange-traded funds
since the beginning of 2021. Its roster
also includes one of the largest China-fo-
cused ETFs, the KraneShares CSI China
Internet ETF Launched in 2013, it has
about US$5 billion in assets.
China’s sheer size and economic
growth rate — even if lower than in past
years — means investors need to have it
in their allocations, fund managers argue.
“Do we fundamentally think that the
second-largest economy in the world
plays a role in investor portfolios? Yup,
no question,” said Bryon Lake, global
head of ETF Solutions at JP Morgan
Asset Management. The firm launched
the JPMorgan Active China in March
2023, which now has about US$9.2 mil-
lion in assets.
In total there were four US-based,
China-focused ETFs launched in 2023,
compared with two the prior year and
eight in 2021, according to Morningstar
data, making a total of 48 US-based, Chi-
na-focused ETFs at the end of 2023.That
takes into account both openings and clo-
sures and is a figure little changed in the
last several years but up 46% in the last
decade.
Read the full story
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
(Feb 20): Japanese companies have logged
record quarterly profits in the three months
that ended in December, underpinning
the Nikkei 225’s advance to near a his-
toric peak.
Net income at Topix 500 companies
rose 46% from year earlier to a record
¥13.9 trillion (US$93 billion or RM443.16
billion) in the October-December quarter,
according to data compiled by Bloomberg.
Excluding Softbank Group Corp, whose
earnings are volatile due to its heavy in-
vestment in global tech companies, profits
still rose 25%.
The strong earnings suggest the ral-
ly that’s pushed major share indices to-
wards record highs has more room to run.
Overseas investors from BlackRock Inc to
Robeco Institutional Asset Management
and Warren Buffett have voiced bullishness
towards Japanese stocks.
Surprisingly strong US economic data
and a cheaper yen have bolstered export-
ers including Toyota Motor Corp. Some
domestic firms are reaping the benefits of
inflation, which lets them push up prices,
and improving corporate governance is also
making investors more bullish.
“Companies’ mindsets have changed,”
said Takashi Hiroki, the chief strategist of
Monex Securities Inc. “We’ll see more
price hikes as companies are able to pass
on cost increases, and that supports their
solid earnings and higher stock prices.”
BENGALURU (Feb 20): Bitcoin is rid-
ing high.
The world’s largest cryptocurrency
has leapt 22% this year to US$52,005
(RM248,454), pushing it past a market
value of US$1 trillion mark for the first
time since its record heyday of late 2021.
Its resurgence has electrified the broad-
er cryptocurrency market, including ether
and other digital coins, which has now
exceeded US$2 trillion, as per data from
CoinGecko.
The sector has been bolstered by the
US regulatory approval of several spot
bitcoin exchange-traded funds (ETFs),
from BlackRock and Fidelity among oth-
ers, which allow access to the crypto coin
vis regular stock exchanges.
The US spot ETFs added 60,000 bit-
coin in the first month of their launch,
more than twice the miner production in
the same period, brokerage Bernstein said.
“The amount of flows far outstrips an-
yone’s expectation,” said Mark Connors,
head of research at Canada’s 3iQ Corp.
Crypto trading volumes are also robust.
Total spot trading volumes on central-
ised exchanges rose 4.4% to US$1.4 tril-
lion in January, recording the fourth con-
20 TheEdge CEO morning brief
w o r l d
Record Japan
profits show
Nikkei primed for
all-time high
by Hideyuki Sano & Yasutaka Tamura
Bloomberg
Toyota was among firms that raised
their guidance, predicting higher full-year
profits due to recovering popularity in hy-
brid cars and robust US demand. A strong
US market helped many other Japanese
companies.
Japanese firms have been able to boost
profits even after the economy fell into a
recession as it contracted for two straight
quarters through December. That’s be-
cause more and more firms have been able
to improve their margins as lingering in-
flation in Japan allows companies to pass
on rising costs to consumers.
Tech underperformers
Some industries marked weak results de-
spite the overall earnings boom. Shares in
a number of companies in the electronics
sector underperformed after they slashed
their annual guidance, suggesting the
Breezy bitcoin
reclaims
US$1 tril crown
by Lisa Pauline Mattackal &
Medha Singh
Reuters
secutive monthly increase and the highest
reading since June 2022, a report by Lon-
don-based researcher CCData said.
The resurgence of interest helped the
largest listed crypto exchange Coinbase
post its first quarterly profit in two years
last week .
“The bitcoin appreciation is contribut-
ing to better spot bitcoin ETF flows, which
is in turn driving bitcoin prices higher, and
pulling other tokens higher as well,” JP-
Morgan analysts said.
US$150,000 Bitcoin in 2025?
Many industry watchers say the outlook
is looking bright at the moment, with in-
vestors buying bitcoin ahead of the block-
long-awaited recovery in the chip industry
is still patchy.Those firms in one of the big-
gest sectors in Japan’s market include Alps
Alpine Co, Ibiden Co and TaiyoYuden Co.
Meanwhile, a slump in China’s econ-
omy hit companies that are reliant on the
world’s second-biggest economy for profits
like factory automation equipment maker
Omron Corp.
Among the best performers on the other
hand were tourism-related firms as well as
food companies, as they reaped the ben-
efits of higher prices on top of a rebound
in tourists from abroad visiting the nation.
Oriental Land Co, the operator of To-
kyo Disneyland, had an operating profit
margin of 35.5%, the highest since at least
2005. Railway operators such as East Japan
Railway Co and Central Japan Railway Co
revised up their guidance. Snack maker
Calbee Inc also beat market expectations
after price hikes.
All in all, Japanese firms posted an av-
erage 10% operating profit margin in the
last earnings period, compared with 8.4% a
year earlier, according to JPMorgan Chase
& Co strategists including Rie Nishihara.
Toyota’s margin was 14% last quarter, the
highest since at least 2001, according to
data compiled by Bloomberg.
The overall strength in earnings is rais-
ing optimism as the Nikkei came close to its
1989 peak. Many analysts have raised their
price target for the stock gauge in recent days.
chain’s “halving” — a preplanned process
that reduces mining rewards in half every
four years — due in April.
Gautam Chhugani, analyst at Bern-
stein, expects 2024 to be a break-out
year for cryptocurrencies where bitcoin
hits all-time highs followed by a peak of
US$150,000 by mid-2025.
“This optimistic outlook is bolstered by
the expectation of an upcoming halving
event and the possibility of interest-rate
reductions,” CCData analysts said.
While bitcoin remain 32% away from
its record high of US$69,000, it notched
an all-time high against the Japanese yen
at ¥7,919,000 last week.
Read the full story
Read also:
Oil hovers near three-week high on
Middle East tensions, China demand
Gold holds ground as focus turns to Fed
minutes
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
(Feb 20): Capital One Financial Corp
agreed to buy Discover Financial Ser-
vices in a US$35 billion (RM167.91 bil-
lion) all-stock deal to create the largest
US credit card company by loan volume,
giving the combined entity a stronger
foothold to compete with Wall Street’s
behemoths.
Capital One will pay 1.0192 of its own
shares for each Discover share, a 26.6%
premium to the closing price on Feb 16,
the McLean, Virginia-based company said
in a statement. The transaction, first re-
ported by Bloomberg News, is expected
to complete in late 2024 or early 2025,
pending regulatory and shareholder ap-
provals of both firms.
The purchase of Discover ranks as the
biggest merger globally this year, surpass-
ing Synopsys Inc’s roughly US$34 bil-
lion acquisition of software developer An-
sys Inc announced in January. It brings
together two storied consumer-finance
brands, a combination that will surpass
rivals JPMorgan Chase & Co and Citi-
group Inc by US credit-card loan volume,
according to data compiled by Bloomberg
Intelligence. The deal will also give Capital
One a foothold in the world of payment
networks.
(Feb 20): Investment banks including
Goldman Sachs Group Inc and Barclays
plc are striving to get a lucrative fee-mak-
ing machine back in action.
Traditional lenders are so keen to win
leveraged buyout financing that some are
pitching for subordinated debt deals —
the riskiest type of underwriting which
they mostly avoided during a bruising
past few years. At least one bank is of-
fering payment-in-kind options, which
allow interest payments to be deferred,
and others are talking to borrowers about
so-called pre-capitalisations, which give
companies financing before a deal has
even gone on the block, according to peo-
ple familiar with the matter.
Banks are hungry to win the gener-
ous fees from buyout deals after a period
marked by having debt stuck on their bal-
ance sheets, which allowed direct lending
powerhouses like Blackstone Inc and Ares
Management Corp to beat them at their
own game. Now, with broadly-syndicated
loan and junk-bond markets roaring back,
it’s easier for banks to sell on debt, and
they’re often able to beat private lend-
ers on price.
“There is a lot of appetite from the
banks to underwrite,” said Giacomo Rea-
li, a high-yield partner at Linklaters LLP.
“In situations where having junior debt
in the structure makes sense, banks will
21 TheEdge CEO morning brief
w o r l d
Capital One to
buy Discover for
US$35 bil in deal
to create largest
US credit card
company by loan
volume
by Liana Baker & Matthew Monks
Bloomberg
bloomberg
Wall Street
banks are trying
everything in
fight to win
underwriting deals
by Eleanor Duncan & Michael Tobin
Bloomberg
want to be competitive and engage.”
Banks have already had a few big wins
over private credit this year. Morgan
Stanley and Goldman were able to poach
nearly half of a US$5 billion (RM23.98
billion) deal to refinance Ardonagh
Group Ltd’s debt from direct lenders.
And JPMorgan Chase & Co and Gold-
man Sachs won a deal to provide US$5
billion in financing to help back KKR &
Co’s purchase of a stake in Cotiviti Inc.
Pricing being discussed on the float-
ing-rate component of the Cotiviti deal
is 3.5 percentage points over the secured
overnight financing rate and a discounted
price of 99.5 cents on the dollar. That’s
significantly cheaper than the debt pack-
age private credit firms were said to be
It’s a “singular opportunity” to bring
together two companies that can compete
with the largest payment networks, Cap-
ital One chief executive officer Richard
Fairbank said in the statement.
Discover rose as much as 18% in
pre-market trading on Tuesday. Shares
in Capital One were down about 3.4%.
Capital One holders will own about
60% of the combined company and Dis-
cover holders the remainder, according
to the statement. The acquisition will
generate pre-tax synergies of US$2.7
billion.
“The main rationale is the fixed costs
of technology that result in bigger being
better,” said Jay Ritter, a finance professor
at the University of Florida. “This fact
has been reshaping many industries for
many years, and I see no reason to think
that the trend toward fewers, but larger,
firms will end.”
Historically, Capital One has had to
rely on Visa Inc or Mastercard Inc to issue
its credit cards. With Discover in hand,
the company would be able to cut out
those two middlemen and have more con-
trol over the prices merchants are charged
each time a consumer swipes one of the
firm’s cards at checkout.
arranging in 2023 at a margin of around
5.25 to 5.5 percentage points over the
benchmark.
“We expected there to be a swing back
to the banks,” said Murad Khaled, the
head of EMEA leveraged finance capital
markets at Bank of America Corp, add-
ing that market dislocation in 2022 and
2023 made direct lenders instantly com-
petitive. “As that dislocation has eased,
we’re starting to see the historic delta
in pricing between the two asset classes
reassert itself.”
Representatives of Goldman, Barclays
and Morgan Stanley declined to com-
ment.
Pre-capitalisations
The quest to win fees is driving some
banks, including Bank of America (BofA),
to pitch pre-capitalisations to companies
that aren’t even for sale yet, according to
a person familiar with the matter. In these
deals, lenders refinance a firm’s debt and
add a portability clause, allowing a new
buyer to keep the existing debt package
in place. Bankers say it makes it easier
for companies to be sold at a later date
because the new owner doesn’t have to
find financing.
Read the full story
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4 22 TheEdge CEO morning brief

w o r l d

WikiLeaks’
LONDON (Feb 20): WikiLeaks founder Pope Francis even granted his wife an
Julian Assange begins what could be his audience last year.

Assange in
last chance to stop his extradition from
Britain to the US on Tuesday after more ‘He will die’

last-ditch battle
than 13 years battling the authorities in the If Assange wins permission in the latest
English courts. case, a full appeal hearing will be held to

to stop US
US prosecutors are seeking to put As- again consider his challenge. If he loses, his
sange, 52, on trial on 18 counts relating only remaining option would be at the Eu-

to WikiLeaks’ high-profile release of vast
troves of confidential US military records
and diplomatic cables.
They argue the leaks imperilled the lives
of their agents and there is no excuse for
his criminality. Assange’s many supporters
hail him as an anti-establishment hero and
a journalist, who is being persecuted for
exposing US wrongdoing and committing
alleged war crimes.
Assange’s legal battles began in 2010,
and he subsequently spent seven years holed
up in Ecuador’s embassy in London before
he was dragged out and jailed in 2019 for
breaching bail conditions. He has been held
in a maximum-security jail in southeast Lon-
don ever since, even getting married there.
Britain finally approved his extradition
to the US in 2022 after a judge initial-
ly blocked it because concerns about his
mental health meant he would be at risk
of suicide if deported.
His lawyers will try to overturn that ap-
proval at a two-day hearing in front of two
judges at London’s High Court in what
could be his last chance to stop his ex-
tradition in the English courts. His wife
Stella last week described it as a matter
of life and death.
They will argue that Assange’s prose-
cution is politically motivated and marks
an impermissible attack on free speech, as
the first time a publisher has been charged
under the US Espionage Act.
extradition
by Sam Tobin & Michael Holden
Reuters
reuters
His supporters include Amnesty In-
ternational, Reporters Without Borders,
media organisations which worked with
WikiLeaks and Australian politicians, in-
cluding Prime Minister Anthony Albanese,
who last week voted in favour of a motion
calling for his return to Australia.
ropean Court of Human Rights (ECHR)
where he has an appeal already lodged
pending the London ruling.
Speaking last week, Stella Assange
said they would apply to the ECHR for
an emergency injunction if necessary. She
said her husband would not survive if he
was extradited.
“His health is in decline, physically and
mentally,” she said. “His life is at risk every
single day he stays in prison — and if he
is extradited he will die.”
Assange’s brother Gabriel Shipton com-
pared the WikiLeaks founder with Alexei
Navalny, the Russian opposition activist
who died in prison last Friday while serv-
ing a three-decade sentence.
“I know exactly what it feels like to have
a loved one unjustly incarcerated with no
hope,” he told the BBC. “To have them
pass away, that’s what we live in fear of:
that Julian will be lost to us, lost to the US
prison system or even die in jail in the UK.”
WikiLeaks first came to prominence
in 2010 when it published a US military
video showing a 2007 attack by Apache
helicopters in Baghdad that killed a dozen
people, including two Reuters news staff.
It then released thousands of secret
classified files and diplomatic cables that
laid bare often highly critical US appraisals
of world leaders from Russian President
Vladimir Putin to members of the Saudi
royal family.

FBI, UK crime
(Feb 20): A coalition of international law The group was responsible for last
enforcement agencies, including the FBI year’s attack on the US arm of Industrial

agency say they

and UK National Crime Agency, said they & Commercial Bank of China Ltd, which
have disrupted LockBit, one of the most disrupted the US$26 billion (RM124.54

have disrupted
prolific hacker groups of all time, including billion) US Treasury market. It also took
shutting down websites the organisation down a website that Boeing Co uses to sell

LockBit cyber
used for ransomware payments. spare aircraft parts, software and services.
A post on the gang’s website Monday LockBit first came to prominence in 2021,

said it’s “now under the control” of the
UK agency, the FBI and other law en-
forcement agencies.
Law enforcement from 11 different
countries took part in the operation, which
seized 11,000 domains used by LockBit
and its affiliates to facilitate ransomware,
an FBI official said. The operation, which
disrupted LockBit’s infrastructure and tar-
geted its malware deployment system, took
place in recent days, the official said.
LockBit specializes in using malicious
software known as ransomware to encrypt
gang
by Jamie Tarabay
Bloomberg
files on its victims’ computers, then de-
manding payment to unlock the files. The
operation recruits hackers to conduct the
cyberattacks using LockBit’s tools and in-
frastructure. LockBit gets a cut of any ran-
som extorted in the hacks.
calling itself LockBit 1.0. In 2022, it became
LockBit 2.0 and its latest iteration is LockBit
Green. One of the group’s most recent victims
was EquilLend.The trading platform, which
processes trillions of dollars of transactions a
month, said the incident on Jan 22 affected
some automated securities lending services.
The hacking group has claimed 1,600
victims in the US and 2,000 internation-
ally, according to the FBI. A good majority
are within the private sector, and the FBI
said it’s tracking 144 million ransoms paid
in relation to LockBit attacks.
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4
Europe being forced to reboot its car industry
(Feb 20): Volkswagen (VW), Renault and
Stellantis are thinking the unthinkable, ex-
ploring tie-ups with sworn competitors to
make cheaper electric vehicles (EVs) and
fend off existential threats.
As Chinese rivals and Tesla Inc expose
competitive weaknesses at Europe’s biggest
mass-market carmakers, it’s become clear
that a sense of urgency is growing, and a
business-as-usual approach is a losing option.
There’s a “perfect recognition that in
the future, the companies which are not fit
to face the Chinese competition will put
themselves in trouble”, Carlos Tavares, the
chief executive officer of Stellantis NV —
the company created from the 2021 merg-
er of Italy’s Fiat and France’s PSA Group
— said in an interview last week. He has
previously said that Europe’s auto indus-
try faces a “bloodbath” if it doesn’t adapt.
Pushed by a slowdown in the pace of EV
adoption, auto executives are discussing ideas
ranging from pooling development resources
to bundling businesses across European bor-
ders to better compete in the once-in-a-gen-
eration shift.The coming months are crucial.
Rather than muscling aside gas guzzlers,
sales of fully electric cars this year are set
to grow at the slowest rate since 2019, ac-
cording to BloombergNEF, with the un-
expected stall in momentum intensifying
competition. Even for Tesla, the slowdown
— which has led to widespread discounting
— has made an impact. A 20% share slump
this year has erased about US$150 billion
(RM719.10 billion) from its market capi-
talisation — more than double VW’s value.
Headwinds for the sector include gov-
ernments dropping incentives, rental firms
balking at ballooning repair costs, and con-
sumers increasingly frustrated with climate
policies impacting their pocketbooks. Elec-
tions in the US and Europe could further
fuel anti-EV sentiment, just as an inflection
point approaches.
In 2025, tighter emissions rules come
into effect in the European Union (EU),
meaning manufacturers need to sell more
battery-powered cars or face hefty fines.
In an unlikely worst-case scenario, VW
could face penalties of more than €2 bil-
lion (US$2.2 billion or RM10.33 billion) if
it fails to sufficiently reduce fleet emissions,
according to Bloomberg calculations based
on company and regulatory data.
As pressure builds on European carmak-
ers to sell more EVs, China’s state-support-
ed manufacturers are entering the cooling
market with models that are often better
and cheaper.
BYD Co’s Dolphin, for instance, is listed
at about €7,000 less than a similarly equipped
23 TheEdge CEO morning brief
w o r l d
by Albertina Torsoli, Stefan Nicola
& Monica Raymunt
Bloomberg
bloomberg
Employees working on the assembly line for
Volkswagen ID.3 and Cupra Born electric
sedans at the plant in Zwickau, Germany.
Pushed by a slowdown
in the pace of EV
adoption, auto executives
are discussing ideas
ranging from pooling
development resources
to bundling businesses
across European borders
to better compete in the
once-in-a-generation
shift. The coming
months are crucial.
VW ID.3, which the German carmaker orig-
inally pitched as the Beetle of the EV era.
The Chinese manufacturer will underscore
its European ambitions by showing off sev-
eral electric models at the Geneva car show
next week, including a luxury sporty utility
vehicle rivalling the Mercedes-Benz G-Class.
Failure for Europe’s carmakers to come
up with a working Plan B risks upheaval in an
industry that employs some 13 million peo-
ple and accounts for 7% of the EU economy.
“We have spent billions as an industry to
make electric mobility possible,” said Hol-
ger Klein, who heads ZF Friedrichshafen
AG — a German parts maker that employs
around 165,000 people worldwide. “Now
the question is: Do we have the right pa-
rameters?”
Renault SA CEO Luca de Meo has been
advocating an alliance akin to the tie-up
that created a European plane-maker to
vie with Boeing Co by pooling assets in
Germany, France, Spain and the UK. The
executive has argued that an “Airbus of au-
tos” would help share the massive cost of
building cheap EVs, while allowing them
to benefit from greater scale.
Interest in broader cost sharing rose
late last year, when Renault presented a
concept for an electric city car that would
cost less than €20,000 — half the price of
VW’s ID.3. De Meo’s initiative is inspired
by Japan’s kei cars. The popular mini vehi-
cles are built by several manufacturers, and
get preferential treatment from regulators.
Different approaches are emerging. Stel-
lantis’s Tavares has openly discussed an in-
terest in mergers and acquisitions, where-
as others are more focused on less-thorny
collaborations.
Renault’s de Meo downplayed specula-
tion about a major combination last week,
telling Bloomberg Television that agility is
more important than size. He confirmed
that talks on a joint EV platform are taking
place “left and right”.
“We’re very open to share that kind of
investment, because it’s very difficult to
make money with small cars,” said de Meo,
who has previously worked for VW as well
as Fiat. “We’re trying to find a way.”
A shake-up in Europe could spill over
to the US, where General Motors Co
(GM) and Ford Motor Co also are paring
back EV investment, and have indicated
that they’re open to partnerships with
peers. US President Joe Biden’s admin-
istration is considering giving manufac-
turers more time for the shift to electric
cars, the New York Times reported over
the weekend.
As they have dialled back investment
plans, traditional carmakers have returned
more money to shareholders, indicating
that a lack of resources isn’t the issue.
GM, Ford and Stellantis spent a combined
US$22.7 billion buying back shares and
paying dividends last year, while Renault
last week proposed its biggest shareholder
payout in five years.
It wasn’t supposed to work out this way,
when the EU approved plans last year to
effectively halt the sale of new combus-
tion-engine cars from 2035. There are a
number of reasons for souring EV senti-
ment. Consumers got glitchy software and
unexpectedly high operating expenses. Be-
cause of maintenance complexities, insur-
ing an EV costs more than a conventional
vehicle — twice as much in the UK, for
example. But affordability might be the
biggest hurdle for mainstream buyers.
Read the full story
Read also: Car sales in Europe jump 11%
in January on pent-up demand
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4 24 TheEdge CEO morning brief

w o r l d

Singapore’s biggest money laundering case

tests city’s weak property market
by Low De Wei
Bloomberg

A
mass sale of prized real estate
seized in Singapore’s biggest
money-laundering case is set to
provide a key test of demand for
a niche part of the financial hub’s proper-
ty market.
More than a dozen so-called shophous-
es, each worth millions of dollars, have
been put on sale as the nation’s largest
bank DBS Group Holdings Ltd steps up
efforts to reduce about S$100 million
(RM354.49 million) in exposure to the
scandal, public listings show. At least five
more marketed are linked to businesses
that took loans from DBS, according to
briefing materials and business filings seen
by Bloomberg News.
Results of the sales will provide the first
indication of demand for the properties
in a market that’s been in the doldrums
since August. That’s when the China-born
money-laundering suspects were arrested, supply and the opportunity to own one is
spooking investors who piled into a boom- Sales of shophouses have very much desired.”
ing part of the island’s real estate sector plunged in the wake of DBS chief executive officer Piyush Gup-
in recent years. the record US$2.2 billion ta said this month that the bank is trying
“It’s a question of orderly decline or money-laundering probe. to sell the assets through receivers. “Once
non-orderly decline” for shophouse pric- Total transactions fell they sell the property, we can get our mon-
es after the Chinese buyer wave fades, ey back,” he said.
said Alan Cheong, executive director of
to S$111 million in the Singapore police said on Feb 9 that they
research for Singapore at Savills plc. “Ei-
last quarter of 2023, a will lift orders prohibiting the disposal of
ther a white knight comes in to bail the drop of 65% from the the properties by DBS “when we are satis-
market out or there’s a great reset.” previous three months. fied that the sale is conducted fairly.”
Shophouses in Singapore have gone Among the shophouses for sale are
from being seen as colonial relics to sym- five spread across Amoy Street and Telok
bols of refined urban life. With typical fea- Transactions were sluggish at the start Ayer Street, popular dining venues in the
tures like terracotta roof tiles, French-style of the year, with just three shophouses sold city centre. They are owned by Jiasheng
timber windows and brightly-coloured fa- in January, the latest URA data shows.That Amoy Pte. At least three more units at
cades, they provide a distinctive heritage compares with five in the same period last Mosque Street, in the Chinatown district,
value for the city-state. year, and 17 in the first month of 2022. are owned by Jiacai Investments Pte and
Median prices reached a record in early What is complicating predictions for also being sold, according to marketing
2023, as the properties were snapped up how the sales pan out is the opacity of materials seen by Bloomberg News.
for retail, restaurants or bars downstairs, the market. Singapore has just more than The two firms together secured nine
and homes or offices in the upper floors. 6,500 shophouses, which date back to the loans from DBS between 2021 and Feb-
But the boom has also been fuelled 1800s, making them highly coveted. ruary 2023 to purchase such buildings,
in part by alleged dirty cash, ensnaring Authorities in turn have yet to pro- and are now in receivership.
banks that provided loans backed by the vide a detailed breakdown of all the as- The director of both companies, Chi-
properties. sets seized, which include other real estate nese national Su Binghai, did business with
Sales of shophouses have plunged in ranging from offices to opulent bungalows, one of the ten arrested in last year’s raids,
the wake of the record US$2.2 billion amounting to more than 200 properties. and is now a subject of police interest af-
(RM10.51 billion) money-laundering It’s not fair to assume that the assets up ter leaving the country, according to The
probe. Total transactions fell to S$111 for sale will hurt the market because prices Straits Times. The receiver for the compa-
million in the last quarter of 2023, a drop depend largely on the location, although nies, Martin Wong of FTI Consulting, de-
of 65% from the previous three months, buyers could seek to submit lowball bids, clined to comment.
according to data on publicly disclosed said Tang Wei Leng, head of capital mar-
deals published by the Urban Redevelop- kets in Singapore at Colliers Internation-
ment Authority (URA). al Group Inc. “Shophouses are finite in Read the full story
 w e d n e s d ay f e b r u a ry 2 1 , 2 0 2 4 25 TheEdge CEO morning brief

M A R K E T S

CPO RM 3,860.003.74 OIL US$ 82.887.18 RM/USD 4.7987 RM/SGD 3.5682 RM/AUD 3.1451 RM/GBP 6.0481 RM/EUR 5.1817

Top 20 active stocks

NAME VOLUME CHANGE CLOSE YTD MARKET 1,555.59
(MIL) (RM) CHANGE CAP
(%) (RM MIL)
Hong Seng Consolidated Bhd 128.40 0.000 0.020 -20.00 102.2
TWL Holdings Bhd 115.00 -0.005 0.030 0.00 161.9
Dialog Group Bhd 92.10 0.340 2.200 6.28 12,413.7
Bumi Armada Bhd 85.50 0.035 0.595 20.20 3,524.0
Minetech Resources Bhd 64.70 0.005 0.175 20.69 312.2
Velesto Energy Bhd 60.30 0.015 0.280 21.74 2,300.4
Fitters Diversified Bhd 57.10 0.000 0.050 0.00 117.1
MMAG Holdings Bhd 54.80 -0.025 0.110 15.79 186.5
Ekovest BHD 54.10 -0.005 0.515 5.10 1,527.2
Widad Group Bhd 47.50 0.000 0.130 -73.20 402.5 World equity indices
Perdana Petroleum Bhd 45.60 0.020 0.285 42.50 632.8 CLOSE CHANGE CHANGE CLOSE CHANGE CHANGE
SMTrack Bhd 42.90 0.000 0.050 0.00 61.1 (%) (%)
Sime Darby Bhd 41.20 0.120 2.630 11.91 17,925.0 DJIA * 38,627.99 -43.70 -0.11 INDONESIA 7,352.60 117.45 1.62
Industronics BHD 39.90 0.010 0.075 50.00 53.1 S&P 500 * 5,005.57 -21.04 -0.42 JAPAN 38,363.61 1,466.19 3.97
Reneuco BHD 36.80 0.000 0.075 -65.91 84.1 NASDAQ 100 * 17,685.98 -276.42 -1.54 KOREA 2,657.79 37.47 1.43
Dagang NeXchange Bhd 34.80 0.020 0.385 -3.75 1,215.2 FTSE 100 * 7,737.05 164.47 2.17 PHILIPPINES 6,854.66 4.50 0.07
Public Bank Bhd 28.90 0.050 4.480 4.43 86,959.9 AUSTRALIA 7,659.05 14.21 0.19 SINGAPORE 3,244.06 105.76 3.37
YTL Corp Bhd 28.40 0.060 2.250 19.05 24,669.9 CHINA 2,922.73 56.83 1.98 TAIWAN 18,753.16 657.09 3.63
YTL Power International Bhd 27.60 0.120 3.920 54.33 31,760.4 HONG KONG 16,247.51 500.93 3.18 THAILAND 1,381.07 -7.30 -0.53
KNM Group Bhd 24.50 0.010 0.095 5.56 384.2 INDIA 73,057.40 1,461.91 2.04 VIETNAM 1,230.06 31.53 2.63
Data as compiled on Feb 20, 2024 Source: Bloomberg Data as compiled on Feb 20, 2024 * Based on previous day’s closing Source: Bloomberg

Top gainers (ranked by %) Top losers (ranked by %)

NAME CLOSE CHANGE VOLUME YTD MARKET NAME CLOSE CHANGE VOLUME YTD MARKET
(%) (‘000) CHANGE CAP (%) (‘000) CHANGE CAP
(%) (RM MIL) (%) (RM MIL)
Focus Dynamics Group Bhd 0.015 50.00 533.5 0.00 95.6 Key Alliance Group Bhd 0.005 -50.00 1,230.0 -50.00 18.4
MQ Technology Bhd 0.025 25.00 1,491.7 0.00 38.0 ZEN Tech International Bhd 0.015 -25.00 266.0 -25.00 40.0
Alam Maritim Resources Bhd 0.025 25.00 142.2 -16.67 38.3 CME Group BHD 0.020 -20.00 760.4 -33.33 21.0
Saudee Group Bhd 0.030 20.00 576.6 20.00 46.9 MMAG Holdings Bhd 0.110 -18.52 54,849.2 15.79 186.5
Dialog Group Bhd 2.200 18.28 92,080.7 6.28 12,413.7 Lambo Group BHD 0.025 -16.67 516.8 25.00 38.5
Salutica Bhd 0.730 17.74 22,261.5 -11.52 309.2 G3 Global Bhd 0.025 -16.67 3,165.7 0.00 94.3
Ta Win Holdings BHD 0.035 16.67 3,483.5 -12.50 120.2 TWL Holdings Bhd 0.030 -14.29 114,996.5 0.00 161.9
Reach Energy Bhd 0.035 16.67 710.8 -12.50 74.5 XOX Networks Bhd 0.030 -14.29 312.9 -14.29 34.1
Aldrich Resources Bhd 0.035 16.67 124.0 -12.50 39.0 PUC BHD 0.040 -11.11 727.9 0.00 98.7
Industronics BHD 0.075 15.38 39,879.3 50.00 53.1 mTouche Technology Bhd 0.045 -10.00 575.7 -10.00 41.7
Ageson Bhd 0.080 14.29 1,034.7 6.67 24.9 AE Multi Holdings Bhd 0.135 -10.00 3,218.1 -10.00 29.2
Progressive Impact Corp Bhd 0.085 13.33 2,653.8 -10.53 55.7 Tune Protect Group Bhd 0.375 -9.64 10,046.3 -6.25 282.5
PDZ Holdings Bhd 0.045 12.50 2,576.7 -10.00 26.5 Citra Nusa Holdings Bhd 0.050 -9.09 6.7 -9.09 36.0
Eduspec Holdings Bhd 0.090 12.50 16,694.2 -5.26 96.0 Vizione Holdings Bhd 0.055 -8.33 98.1 -8.33 112.5
WMG Holdings Bhd 0.140 12.00 8,480.3 40.00 62.2 PNE PCB BHD 0.065 -7.14 40.0 -23.53 36.4
Sapura Resources Bhd 0.380 11.76 94.6 1.33 53.0 TCS Group Holdings Bhd 0.130 -7.14 10.0 -3.70 55.8
KNM Group Bhd 0.095 11.76 24,532.0 5.56 384.2 BTM Resources BHD 0.070 -6.67 235.0 0.00 88.0
Permaju Industries Bhd 0.050 11.11 956.7 0.00 97.4 Luster Industries Bhd 0.070 -6.67 475.1 0.00 211.6
Parkwood Holdings BHD 0.150 11.11 24.0 3.45 41.3 Sarawak Cable Bhd 0.210 -6.67 11,805.4 -44.00 83.8
Asian Pac Holdings Bhd 0.110 10.00 2,195.0 4.76 163.8 Ivory Properties Group Bhd 0.070 -6.67 140.0 -12.50 34.3
Data as compiled on Feb 20, 2024 Source: Bloomberg Data as compiled on Feb 20, 2024 Source: Bloomberg

Top gainers (ranked by RM) Top losers (ranked by RM)

NAME CLOSE CHANGE VOLUME YTD MARKET NAME CLOSE CHANGE VOLUME YTD MARKET
(RM) (‘000) CHANGE CAP (RM) (‘000) CHANGE CAP
(%) (RM MIL) (%) (RM MIL)
United Plantations BHD 21.000 0.480 474.7 17.98 8,710.5 Heineken Malaysia Bhd 22.920 -0.520 535.5 -5.05 6,924.1
PPB Group Bhd 15.500 0.360 791.7 7.04 22,050.3 Malaysian Pacific Industries 26.260 -0.240 35.9 -6.88 5,223.9
Dialog Group Bhd 2.200 0.340 92,080.7 6.28 12,413.7 Allianz Malaysia Bhd 19.240 -0.140 58.3 4.34 3,424.1
Petronas Chemicals Group 7.090 0.250 5,109.1 -0.98 56,720.0 Dutch Lady Milk Industries 23.700 -0.100 5.9 2.33 1,516.8
ViTrox Corp Bhd 7.200 0.180 428.6 -1.23 6,807.0 Kesm Industries Bhd 6.630 -0.070 1.6 -6.22 285.2
Tenaga Nasional Bhd 11.360 0.160 5,691.6 13.15 65,744.1 Carlsberg Brewery Malaysia 19.200 -0.060 150.5 -0.41 5,870.4
Dayang Enterprise Holdings 2.300 0.130 24,197.2 43.75 2,662.9 SHH Resources Holdings BHD 1.200 -0.060 50.0 -14.89 120.0
YTL Power International Bhd 3.920 0.120 27,620.2 54.33 31,760.4 Chin Hin Group Bhd 3.960 -0.060 164.0 12.18 7,006.9
Sime Darby Bhd 2.630 0.120 41,166.8 11.91 17,925.0 AEON Credit Service M Bhd 6.230 -0.060 429.4 11.85 3,181.1
Teo Seng Capital Bhd 2.300 0.120 2,850.8 43.75 674.7 Fraser & Neave Holdings Bhd 29.100 -0.060 114.9 3.95 10,673.3
Salutica Bhd 0.730 0.110 22,261.5 -11.52 309.2 Hong Leong Industries Bhd 9.420 -0.050 15.0 2.28 3,009.4
Hengyuan Refining Co Bhd 3.200 0.110 927.8 4.23 960.0 AME Elite Consortium Bhd 1.700 -0.050 1,389.0 1.80 1,086.5
Hong Leong Financial Group 16.480 0.100 242.0 0.24 18,873.6 Comintel Corp Bhd 1.440 -0.050 174.9 3.60 651.6
Wasco Bhd 1.270 0.100 2,359.6 27.64 983.4 Can-One Bhd 2.430 -0.050 134.3 0.00 466.9
Nestle Malaysia Bhd 122.000 0.100 124.8 3.74 28,609.0 MBM Resources BHD 4.600 -0.050 1,335.7 8.49 1,798.1
Axiata Group Bhd 2.890 0.100 10,679.0 21.43 26,527.6 HextarTechnologies Solutions 1.330 -0.050 2,427.1 -5.42 2,737.7
Riverview Rubber Estates BHD 3.300 0.090 3.0 0.61 214.0 Bintulu Port Holdings Bhd 5.700 -0.050 14.4 10.89 2,622.0
Hume Cement Industries Bhd 2.940 0.090 449.6 30.67 1,843.7 KLCCP Stapled Group 7.600 -0.050 187.4 7.19 13,720.5
PMB Technology Bhd 2.720 0.090 286.8 -2.16 4,408.7 MISC Bhd 7.600 -0.050 2,621.6 4.25 33,924.5
Uzma Bhd 1.240 0.090 10,875.5 65.33 480.2 MNRB Holdings Bhd 1.850 -0.050 1,509.7 51.64 1,448.7
Data as compiled on Feb 20, 2024 Source: Bloomberg Data as compiled on Feb 20, 2024 Source: Bloomberg